Executors Savings account?

ab56

Does anyone know of or been able to open a savings account in executors names (2) to earn some interest before distribution to beneficiaries.  TIA

Keep_pedalling

You can do, but is probably not worth doing. If we are talking large sums then I would reduce them by making interim payments to the beneficiaries.

Newly_retired

I opened both a current account and a savings account with the same bank my husband banked with, but in my name only. The other executors were ok with this as it saved a lot of hassle.

JGB1955

AIUI any interest earned by the 'estate in administration' is taxable at 20%.  The estate does not have a tax free allowance.  It may be better, financially, for the funds to be distributed, allowing the beneficiaries to benefit from their (up to) £18,570 interest allowance.

Olinda99

it doesn't have to be a special executor's savings account - just open a normal savings account in one if the executor's names

Savvy_Sue

Added to the above, putting it in your own name (rather than the estate's name) means it falls into your estate should you die before distribution. Or if you divorce or need to claim means tested benefits.

None of the above may look likely to happen, but it's a complication best avoided IMO.

doodling

Hi,

Savvy_Sue said:

Added to the above, putting it in your own name (rather than the estate's name) means it falls into your estate should you die before distribution. Or if you divorce or need to claim means tested benefits.

None of the above may look likely to happen, but it's a complication best avoided IMO.

Note that should any of those things happen then a corresponding debt owed by the executors estate to the beneficiaries would also exist so it all balances out.  As the executors role is inheried by the executors executor then the death case doesn't matter one way or another.

Also note that other than labelling, there is no difference between an account in the name of "The executor of X deceased" and in the actual name of the executor.  They are both money legally owned by the same person and are literally in the same person's name.  The only difference is that the labelling of the account is easier for others to understand (I agree that is a significant benefit in some cases).

Springe

I (along with my brother and brother-in-law) am an executor for my late mother's estate. I now have probate (and I am the only named executor (the others have power reserved)).
Some of the estate (c£200k) will need to be held for 2 or 3 years (as beneficiaries are not old enough yet to inherit) by the executors.
With this amount for this length of time, I want the funds to be held in an interest-bearing account. So I wish to find an executor's savings (preferably jointly operated with my brother) account for these funds; I don't wish the accounts to be in my own (or my brother's) name as that will complicate our personal tax affairs.
Does anyone have any ideas of where I might find/who offers such an account? Despite searching, I have not yet found such an account on offer.
Thanks

SadCodeMan

One possibility is to look at Hargreaves Lansdown? They offer a bare trust account. I don't know if they offer one with joint names as excutors.

It is not quite as good as it could be however because

1. They don't (I think) allow you to have an active savings account on the above. You would need to buy Gilts (or similar) for the investment.

2. They are just about to change the charging structure so where these were once free, there will be a charge for running it.

(There may well be other providers who fit the bill better than HL now)

If you already 'do' that sort of thing for yourself though (and so feel comfortable), it might be an option.

Keep_pedalling

Anything inherited by minors needs to be held in trust, not in an executor account and you need to have a trust account for each beneficiary.

Are these beneficiaries actually minors or is it down to the will stating that they should not inherit until a certain age? If the latter you need to be aware than many (probably the majority) of such clauses are no more than wishes and the beneficiaries are actually entitled to their inheritance at 18 (16 in Scotland).

NedS

https://forums.moneysavingexpert.com/discussion/comment/80362478#Comment_80362478

Only amounts over £500 per tax year are reportable. If income is £500 or below then it is tax free and does not need to be reported to HMRC:

https://www.gov.uk/probate-estate/reporting-the-estate