What is a beneficiary?

A Beneficiary is someone who receives an inheritance from a deceased person’s estate. If there is a Will, the Will sets out who will inherit the estate. If there is no Will, then the beneficiaries will be determined in accordance with the Rules of Intestacy.

The Executors or Administrators have a fiduciary relationship to all beneficiaries of the estate, meaning a relationship of trust. They are responsible for contacting all of the beneficiaries to notify them of their interest in the estate.

The Executors are the persons appointed in a Will to deal with the administration of the deceased’s estate. Where there is no Will, the Rules of Intestacy will once again set out who can apply to become the estate’s Administrator.

What type of beneficiary am I?

There are many types of beneficiaries within a Will and what type of beneficiary you are will determine how much information you will receive from the Executors in respect of the estate and what your rights are if that information is not provided:

Specific Bequests

Beneficiaries of these gifts receive a specific item (either money or a specific item of property). If that specific item is no longer owned by the deceased at the date of their death then this gift fails. For example the Will might say “I give all my jewellery to my daughter”. If no jewellery is owned at the date of the deceased’s death then the gift will fail.

Demonstrative Bequests

These gifts when set out in the Will often include the word “my” for example “I give £100 from my current account with X bank to my nephew”. If the current account with X is no longer owned by the deceased at the date of their death then it would become a general bequest and the £100 will be paid from other assets held by the deceased that have not otherwise been gifted through a specific or demonstrative bequest.

General Bequest

These gifts are paid out of the general estate for example, “I give £100 to my niece”. These gifts will be paid from general funds that have not otherwise been gifted through a specific of demonstrative bequest.

Residuary Bequest

Beneficiaries of these gifts receive their share of inheritance from the residue of the estate (what is left after all debts and expenses have been paid). This means that the amount the residuary beneficiary receives is not determined until the administration of the estate has been finalised, clearance obtained from HM Revenue and Customs in respect of Inheritance Tax, Income Tax and Capital Gains Tax, if applicable, and the Estate Accounts have been drawn up.

These residuary bequests are often the first to be reduced or even lost altogether if there is no residue left once all debts/specific/demonstrative and general gifts have been paid.

Frequently Asked Questions we receive from beneficiaries:

How long after a person has died will it take for me to be notified of my inheritance?

It is the Executor’s responsibility to notify the beneficiary of an estate, but there is no law dictating the time frame for an Executor to do so. In some cases the Executors will wait until the grant of probate is received, as that means the Will is proven, and then they will notify the beneficiary at that point in the process.

Once notified, the Executors should update the beneficiaries periodically with the progress of the administration of the estate. By informing the beneficiary of their entitlement, the Executors will find out whether there will be any claims brought forward under the Inheritance (Provisions for Family and Dependants Act) 1975 explained further on in this article.

It is only the residuary beneficiaries who are entitled to a copy of the Will, but if you want a copy then such document is available from the Probate Registry, from six months after the grant is issued. There will be a small fee for this.

How long after a person has died will I receive my inheritance?

Probate matters invariably taken much longer to sort out than one would expect, even if they appear to be quite straightforward. There is often a bulk of unconnected paperwork to sift through and deal with, resulting in miscellaneous correspondence with various third parties. The Executors may also be required to sort out the various different procedures for collection of the estate monies, and in selling or transferring estate assets. This all takes time, and delays can be encountered in third parties not answering queries raised of them and in their processing claims.

In the majority of Estates, the Executors have to deal with HM Revenue and Customs in settling the tax position, both at the date of death and during the administration period, and therefore this cannot be finalised until the administration of the estate has been completed.

To cover these possible delays, and to acknowledge the amount of work often involved in dealing with the administration of an Estate, the Administration of Estates Act provides that an Executor is under no obligation to distribute the Estate within the first year after the date of death. Thereafter, distribution should only take place with “due diligence” and not necessarily immediately.

In the same way, the Act provides that there can be a personal liability for an Executor who distributes an Estate too early.

Problems over early distribution can arise in a number of circumstances. These can include where, after the estate has been distributed, previously unknown creditors of the deceased materialise or where a person makes a successful claim under the Inheritance (Provision for Family and Dependants) Act 1975 that the deceased has not made reasonable financial provision for.

These potential problems from Executors can be dealt with by not distributing the estate until a period of at least six months has passed since the date the Grant was issued, as any such claim should be made within 6 months of the date of the Grant. However, as the claimant can delay the serving of their claim for 4 months, it is advised that Executors wait the full 10 months from the date of the Grant before distribution.

Considering the above you will note that it is very difficult to state a timeline for the administration process to be finalised and for you to receive your inheritance.

We would advise that you contact the Executors periodically to obtain an update on the administration process. Sometimes it is possible for an interim payment to be made to beneficiaries before the estate administration is complete.

When the Executors are in a position to finalise the estate, they will then prepare Estate Accounts.

What happens I am not happy with how the Executors have administered the estate?

If you feel that the Executors have breached their duty to the estate then you may be entitled to make a claim against the Executors for any loss resulting from that breach.

In some cases, you can also make an application for an Executor to be removed by Court Order. If you would like to know your rights or more information regarding this issue please contact Sharon Auton in our Civil Litigation Team on 01206 574431.

What are estate accounts? Am I entitled to see a copy of them?

Estate Accounts contain a complete record of all financial transactions during the administration of a deceased’s estate from the date of death to the conclusion of the administration period. They will not be produced until the estate has been finalised.

There are no set rules or guidelines for Executors to follow when drawing up Estate Accounts; however it is standard practice to include a summary of the terms of the Will/Intestacy, Capital account, Income account, Liabilities account and Distribution account.

Unlike the Will, which becomes a public document once it has been lodged at the Probate Registry, the Estate Accounts are only seen and approved by the residuary beneficiaries (or the parent(s)/guardian(s) of the residuary beneficiaries if they are minors).

Can I contest the deceased’s Will?

The duty of the Executor is to uphold the Will, and distribute the assets of the estate according to its terms.

However, a disappointed beneficiary may be able to contest a Will if they believe that either;

  • the Will was not executed properly
  • the deceased lacked the required mental capacity or knowledge to make a Will
  • the Will has been forged
  • the deceased was making the Will under duress

You may also be able to contest a Will under the Inheritance (Provisions for Family and Dependants) Act 1975 if you believe that you have not been adequately provided for by the deceased’s estate, meaning that you were financially dependent on them during their lifetime and you believe that you should receive a share/larger share of their estate on their death. Again, for more information regarding contesting a Will/Intestacy please contact Sharon Auton in our Civil Litigation Team on 01206 574431.

If you wish to discuss the Administration of Estates or Beneficiaries then please contact the Thompson Smith and Puxon Wills and Estates team. They can be contacted on 01206 574431 or by email at info@tsplegal.com.