Distributing the Estate Assets to Beneficiaries

Right, you have gathered the assets and cleared the debts and taxes. This is the moment you have been working towards: distributing the remaining estate to the beneficiaries according to the Will. It’s the final piece of the puzzle, so let's make sure it's done correctly and transparently.

First Things First: Final Checks

Before you hand anything over, double check:

• All known debts have been paid.
• All taxes (including final income tax and any remaining IHT) have been settled or accounted for.
• All administration expenses (probate fees, valuation costs, etc.) have been paid from the estate.

You must settle all obligations before distributing the net estate.

Distributing Specific Gifts (Legacies)

The Will might specify particular items go to particular people, like antiques, jewellery, art, or other personal possessions.

• Identify the Items and Beneficiaries: Carefully check the Will to see exactly who gets what.
• Arrange Handover: Contact the beneficiaries to arrange collection or delivery of their specific items.
• Get a Receipt: Ask each beneficiary to sign a simple receipt confirming they have received their specific gift. This is important evidence for your records and the estate accounts.

Calculating the Residue

The 'residue' or 'residuary estate' is everything left over after all debts, taxes, expenses, and specific gifts have been dealt with. This typically consists of the remaining cash but could include other assets like shares or property if they weren't specifically gifted or needed to be sold.

Distributing the Residue

The Will states who inherits the residue and in what proportions. In your case, this involves dividing the residue among you and your sisters.

• Follow the Will: Adhere strictly to the shares specified (e.g., equally between the three of you, or different percentages).
• Transfer the Assets:
  • Cash: The most common form of residue. Transfer the calculated shares directly to each beneficiary's bank account.
  • Other Assets: If distributing assets like shares, you will need to complete the necessary transfer forms (liaise with your broker or the share registrar). Discuss this with the beneficiaries first; they might prefer assets to be sold and receive cash.
• Keep Records: Document exactly how the residue was calculated and how much was distributed to each beneficiary, along with the date of transfer.

Essential: Prepare and Share Estate Accounts

Before making the final distribution, or alongside it, you must prepare final estate accounts. This is crucial for transparency and protects you as executor.

• What are Estate Accounts? They are a clear summary showing:
  • All assets of the estate and their values at the date of death.
  • Any income received during the administration period (e.g., interest, dividends).
  • All payments made for debts, taxes, funeral costs, and administration expenses.
  • Details of specific gifts distributed.
  • How the final residue was calculated.
  • The amount distributed to each residuary beneficiary.
• Why Prepare Them? Beneficiaries are entitled to see how the estate has been managed and their share calculated. Clear accounts prevent misunderstandings and disputes.
• Share with Beneficiaries: Send a copy of the final estate accounts to all residuary beneficiaries. It is good practice to ask them to sign a statement confirming they approve the accounts and accept their share in final settlement.

Wrapping Up

Distributing the estate is the culmination of your hard work as executor. By carefully following the Will, handling specific gifts correctly, calculating the residue accurately, and providing clear estate accounts, you bring the process to a proper and transparent close.

You have navigated a complex journey. Completing this final step properly ensures the wishes in the Will are fulfilled and provides peace of mind for everyone involved. Well done.