Executor Expenses-what can you claim and how much?

In her latest update, Fiona Ashworth, Head of our Wills and Estates team, talks about the expenses executors can claim so that they are not left out of pocket.

What Can You Claim and How Much?

If you have been named as an executor in a Will you will have a lot of responsibilities. The primary duty of executors is to the beneficiaries by carrying out the wishes of the deceased as set out in their Will. Executors can act together or alone, but an executor cannot go against the terms of the Will, breach their fiduciary duty, fail to act, self-deal, embezzle or harm the estate through neglect.

Dealing with these responsibilities will likely result in out of pocket expenses.

An executor should not be left out of pocket for completing their duties and, in many cases, they will be able to claim these expenses back from the estate.

What expenses can an executor claim for?

The basic starting position is that, like trustees, executors must act for free. They can be reimbursed for reasonable expenses – for instance, mileage incurred when carrying out their duties, postage charges, reasonable general house and garden maintenance for protecting the asset and complying with Insurance requirements – but they cannot charge a fee. For example, if you were claiming for expenses relating to travelling by car, you would only be able to claim at the accepted HMRC rate of 45 pence per mile.  All claims for reimbursement must be considered reasonable.

It may not be possible to access money belonging to an estate before a grant of probate has been issued. This means that any costs that have arisen as part of administering the estate before this point may have to be covered by an executor from their own pocket.

What expenses can’t an executor claim for?

Though it is clearly stated that an executor should not be left out of pocket by their responsibilities, this does not extend to paying non-professional executors for their time. As a non-professional executor you cannot claim an hourly rate for the time you’ve spent working on the matter. You are also unable to claim any remuneration for time you may have had to take off work.

This can be confusing because if the person who has died chose to appoint a professional executor in their Will – such as a solicitor or accountant – those individuals would be paid for their time.

If you believe you have been appointed as an executor, based on your profession and expertise, we’d recommend seeking specialist advice from a probate solicitor.

What about if an executor will be left significantly out of pocket due to time commitments?

If you feel that you would be left significantly out of pocket because of the time you would need to invest in administering the estate, you can consider appointing a solicitor to administer the estate on your behalf. The solicitor’s fees would be paid for by the estate.

What if the beneficiaries believe an executor has claimed for unreasonable expenses?

It is important to remember that any money you claim from the estate to cover your executor expenses then reduces the amount that is left to distribute among the residuary beneficiaries.

If the residuary beneficiaries believe that an executor has claimed unreasonably for their expenses, they may ask for copies of receipts for expenses claimed, and they may be able to take legal action against you.