The duty of an Executor is to ascertain details of assets and liabilities of the estate and of any gifts made by the deceased.
The difficulty is being certain that you have taken reasonable care to find these details.
HM Revenue and Customs says this in it’s Inheritance Tax customer Guide:-
‘How do I find the deceased’s assets?
Make a thorough search of all the deceased’s papers about their financial affairs.Make a rough list of their assets investments ,their other financial interests and the debts they owed when they died.
If the deceased had to fill in Self Assessment tax returns they may have kept records to fill in those forms and these may help .Bank statements and building society passbooks may help you to discover whether any gifts were made .Remember that although the income from certain assets such as PEPs ,TESSA’s and ISA’s is not liable to income tax both the capital and the income are liable to inheritance tax and must be included.
You may also find it useful to ask others what they knew of the deceased’s.People who might be able to help are
Any solicitor or accountant who dealt with the deceased’s affairs ,
The deceased’s close family [especially to discover gifts]
Anyone named in the Will who might know about the deceased’s affairs,
Any close business associates of the deceased,
The deceased’s bank ,stockbrokers or other financial advisers [the bank may have other papers or valuables lodged with them for safekeeping].
You will need to make quite detailed enquiries so that you can find out about everything that makes up the deceased’s estate.It is very important that you provide full and accurate information because you may make yourself liable to a financial penalty if you provide information incorrectly due to your negligence or fraud’.
It is therefore necessary to look at ,at least some of,the deceased’s bank statement and retained paperwork to get a sense of their affairs.
Family members should be warned of the dangers of non disclosure.The penalty regime allows a penalty to be charged where an inaccuracy in the liable person’s document was attributable to another person .This is particularly rele vant to inheritance tax where Executors inevitably rely on other people to provide them with information about the deceased’s estate.
Where it can be shown that the other person deliberately withheld information or supplied false information to the liable person with the intention that the IHT account or return would contain an inaccuracy ,a penalty may be charged on that other person.
BUT that will not mean necessarily that the Executors are off the hook. If the withheld or false information gave rise to those inconsistencies in the information received about the estate and the PRs do not question those inconsistencies, they may also be charged a penalty for failing to take reasonable care.
It is clear from the above that the role of Executor or Administrator can be quite perilous and the estate administration is better dealt with by people who are experienced in this area.
Our own estate administration company is made up of a legal team with many years experience and we would be very pleased to assist in dealing with an estate administration on your behalf for a very competitive fee.