Executors vs Trustees in Probate – What are their responsibilities?
Choosing your executors and trustees or agreeing to act in either role for someone else can be a daunting decision. While the terms are often used interchangeably in Wills, they are distinct legal roles with different responsibilities.
This short guide aims to help you understand the differences between the two roles so that you can make informed decisions when preparing your will or accepting an appointment.
What is an executor (or personal representative)?
An executor is the person appointed in a Will to administer the estate of someone who has died. Executors are a type of “personal representative”. A personal representative is a term that also includes administrators appointed when there is no Will (or a valid Will).
Their responsibilities can include:
Registering the death and notifying relevant organisations of the deceased’s passing.
Identifying and valuing the deceased’s assets and liabilities.
Completing relevant inheritance tax forms and arranging payment of any tax due.
Applying for the Grant of Probate.
Collecting in the deceased’s estate assets.
Paying debts and liabilities.
Maintaining accurate estate accounts.
Distributing the deceased’s estate in accordance with the Will.
Executors owe legal duties to the beneficiaries and creditors of the estate and must administer the estate with reasonable care and diligence. WT Solicitors can assist executors with every stage of the probate process and help reduce the administrative burden during what is often a difficult time.
What is a trustee?
A trustee is responsible for administering assets held in a trust. A trust may arise during someone’s lifetime or under the terms of a Will.
Their responsibilities may include:
Protecting and managing trust assets.
Making decisions about investments and distributions.
Maintaining trust accounts and records.
Filing trust tax returns and complying with HMRC requirements.
Exercising powers fairly and impartially between beneficiaries.
Acting in the best interests of the beneficiaries.
Trustees must exercise reasonable care and are subject to fiduciary duties when exercising their responsibilities. They may find themselves personally liable if they breach their duties. WT Solicitors offers a bespoke Trust Administration Service to support trustees in fulfilling these ongoing obligations.
What are some of the similarities between the roles?
There are a number of similarities between the two roles:
Neither appointment is compulsory; the nominated person may decline to act.
Both roles involve fiduciary duties and significant legal responsibility.
Professional executors or trustees (e.g. solicitors or accountants) can be appointed.
Professional appointees may often be held to higher standards because of their expertise and regulatory obligations.
What are some of the differences between the roles?
Executor
A shorter-term role which is limited to the probate process.
The role is primarily focused on collecting assets, paying liabilities and distributing the estate.
Owes duties to estate’s beneficiaries and creditors.
You can either have a sole executor or multiple executors.
Can have “power reserved”, allowing another executor to act initially and then opt to get involved at a later date.
Accountable to the Probate Registry and the courts.
Trustees
A longer-term role which can continue for many years or decades.
The role is more focused on managing and preserving trust assets.
Primarily owes duties to the trust beneficiaries.
There must be two or more trustees.
Must either act, retire or be removed in accordance with the relevant trust provisions and applicable law.
Subject to fiduciary duties enforceable by the beneficiaries and the courts.
What should I consider when picking my executors and trustees?
When deciding who to appoint, it is important to think carefully about the practical responsibilities involved. Some factors to consider include:
Age and availability
An older family member may be well suited to acting as executor for a short administration period but may find the long-term obligations of trusteeship more difficult. You should consider whether your proposed appointees realistically have the time, organisational ability and willingness to take on the role as executor/trustee.
Experience and skills
Executors and trustees may need to deal with financial institutions, legal documentation, property matters and tax issues. It is therefore important to choose someone who is reliable, organised and capable of making balanced decisions.
Potential conflicts of interest
A Will may appoint the same people to both roles, but this may not always the best option. For example, if a beneficiary is also an executor, you may prefer different trustees to oversee any ongoing trust arrangements to avoid potential conflicts of interest.
Trusts for children
If part or all of your estate is left to a minor, those assets will usually be held on trust until the child reaches 18 or the age specified in the Will. Appointing trustees who are different from the child’s guardians can help provide an additional safeguard of the funds intended for the child’s benefit (reducing the possibility of any mismanagement of the funds).
Both executors and trustees take on positions of trust carrying significant responsibilities. Before making appointments in your Will, or agreeing to act for somebody else, it is important to understand what each role involves. Taking professional advice can help ensure the right people are appointed and that they are properly supported in carrying out their duties.
If you would like advice about our probate, will drafting or trust administration services, please contact us on 01844 899150 where we would be happy to help!