The general purpose of executor’s remuneration is to pay the executor for the time spent by them performing the role. Remuneration clauses are more common when you appoint a professional person or entity as your executor (as opposed to a family member) or if you expect that your estate will be particularly onerous.
Remuneration can take the form of fees for actual time spent (usually an hourly/daily rate), commission or a combination of both. Commission is often a fixed percentage of the value of your estate.
Remuneration is not the same as reimbursement. Your executor will be reimbursed for any reasonable out of pocket expenses incurred by them when administering your estate regardless of whether they receive remuneration as well. They will also be able to use your estate funds to pay any reasonable debts and expenses of your estate.
Do I have to “pay” my executors?
No, you are not required to include provision for the payment of remuneration in your Will and it is open to you to nominate an executor that will not charge remuneration.
Executors and administrators of deceased estates do not have an automatic right to receive fees or commissions in the administration of a deceased’s estate.
If you wish to include provision in your Will for your executor to receive fees or commissions when acting for you, you must provide written informed consent to the inclusion of such remuneration clause before the Will is executed.
We strongly recommend that you obtain independent legal advice before making such provision in your estate planning.
If you do not make provision for remuneration in your Will which accords with the requirements of the Act, remuneration may only be claimed if:
The executor obtains informed consent from each interested beneficiary pursuant to section 65C of the Administration and Probate Act 1958; or
Can my executor also be a beneficiary?
Yes, your executors and beneficiaries may overlap even though the roles are different. For example: if your children are your executors, they may also be your beneficiaries.
Your executors may receive gifts in your Will which are unrelated to their role as your executor. These gifts are not regarded as remuneration.
It is not required however for executors to be beneficiaries or for beneficiaries to be executors. There are many reasons why you may wish for your executors and beneficiaries to be different.
Your choice of executors and beneficiaries requires careful consideration following expert legal advice. Please contact RNG Lawyers to discuss your estate planning needs and wishes.
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