The question is often asked, “Can an executor actually be one of the beneficiaries?” The short answer to that is yes. A person can be both a beneficiary and an executor for a will. It’s actually far more common than many people think.
While some people may argue concern about conflicting interests, it actually makes sense, as executors are better able to perform their duties when they’re familiar with the decedent’s situation. Someone close enough to the decedent to be a beneficiary would likely have that awareness.
Since an executor knows the deceased well and is familiar with their situation, they’ll be able to perform duties more efficiently. Someone who is that familiar with the deceased’s holdings, wishes, and perhaps even the will itself, is also more likely to be a family member. In turn, that means there’s a very real chance that they are a beneficiary as well.
What Is a Beneficiary and What Is an Executor?
Few people have reached adulthood without hearing the terms beneficiary and executor, but not everyone knows exactly what they mean. And that can be a problem when it comes to making funeral arrangements. People generally have a rough idea from television or movies and so on, but the terms have very precise legal meanings in the United Kingdom. Let’s talk about what they really mean and why they matter.
A beneficiary (in terms of a will) is a legal term for someone who receives something. Essentially, you can remember it as someone who gets a benefit of some kind. Even if you give a neighbour, for example, a bequest of just £50 in your will, the neighbour is then a beneficiary of the will.
On the other hand, an executor has a lot more legal obligations. Executors make burial and funeral arrangements. Executors are responsible to pay the deceased’s outstanding debts and distribute the inheritances stipulated to their rightful owners.
There are many rules that executors have to follow, and there are penalties for mishandling someone’s estate.
Can the Sole Beneficiary of a Will Be the Executor of It?
At a quick glance, it could seem underhanded to have a sole beneficiary be the executor of a will. But the truth of the matter is that it is perfectly legal in the UK for a single person to be both the beneficiary and the executor of a will.
Under normal circumstances, the executor of the will is entitled to be paid by the estate for the service he or she is performing. When the executor is the same person as the beneficiary, they don’t usually take payment for the executorial work they’re required to do. They would essentially be paying themselves out of their own money.
Do You Really Need to Bother with Wills, Executors, and Beneficiaries?
We have written for the need for a will and advice for going through probate. Many people are put off from making a will simply because they don’t understand legal terms like a beneficiary, or executor. But if you don’t make a will, your beneficiaries, which in most cases are your surviving family members, will likely have to pay more in taxes than they would otherwise be required to.
On another note, without a will, your house, savings, digital assets and other belongings may not go to the individuals you want them to go to. It’s always a mistake to assume that the family will automatically follow your wishes after you’re gone. If you want your wife to inherit the house, you should say so in a will.
It becomes even more complicated if you have a family business of any kind. A will is an important part of succession planning that you should consider. If you want the business to continue, then protect it from being sold off by stipulating it in a will.
Once everything has been distributed as per the will and all taxes are paid, all remaining assets are dealt with in accordance to residuary estate rules.
Where there is a will, there is both an executor and a beneficiary (or beneficiaries). The terms all go hand in hand. Making a will now means that your intentions can be carried out just the way you want after you pass on.