Can an Executor Withhold Money from a Beneficiary?
As a beneficiary, you’re entitled to receive a share of the inheritance left behind by your loved one.
But there are cases where money or assets will be withheld by the executor of the Will, which can cause a great deal of financial stress on top of the grief you’re already experiencing.
In this guide, we’ve set out how long an executor can withhold funds for and the reasons they might do this, as well as what you can do if an executor is refusing to communicate with you.
How long can an executor hold funds for?
Although it can be frustrating for beneficiaries, there are no legal requirements for executors to distribute funds within the first year of taking on the role. This is commonly called the ‘executor’s year’.
But the law also recognises that in more complicated situations, it can take longer than this for funds to be paid out to beneficiaries. So there are no specific time limits in place for an executor to distribute an estate when justifiable reasons are given for the delay.
Why might an executor withhold funds?
There are a few cases where it’s acceptable for an executor to withhold funds. This is known as ‘reserving’, and should be only done when absolutely necessary.
Some of the most common reasons for executors withholding money include:
- Debts that need to be paid off
It’s not unusual for executors to hold back on paying beneficiaries until they’re confident that any debts have been paid off. This will protect the executor from having to pay out of their own pocket for any claims made by creditors later on. - Missing beneficiaries
If a beneficiary cannot be contacted, it can cause a delay in the estate being distributed. This also applies if a beneficiary is refusing to accept a share of the estate, or if the beneficiary is a minor and unable to ‘give receipt’ for a gift or funds left to them. - Money that is held in a trust
If money has been left in a trust, an executor can withhold payment from a beneficiary in certain cases. This will usually apply if the beneficiary is a child or an adult lacking mental capacity.
In some instances, an executor may also decide to wait six months after receiving a grant of probate before distributing funds. This is because dependants and family members have up to six months to submit a claim against the estate, which could change how it is shared out.
It’s important that executors seek the advice of an experienced solicitor before deciding to withhold any funds from beneficiaries. If not, they could face financial and legal consequences further down the line.
Does an executor have to show accounting to beneficiaries?
When a grant of probate has been provided, the executor should be keeping accounts related to the distribution of the estate.
It is considered to be good practice for executors to be transparent and share this information with beneficiaries, but there is no legal requirement for them to do this.
If you’re concerned that an executor is not acting as they should be, or they’re refusing to communicate with you, there are legal actions you can take to address this.
What to do if an executor is ignoring you
If you have worries about how an executor is handling the estate of your loved one, the first thing you should do is ask them about the delay. There may be a valid reason for the process taking longer, so it’s always worth checking with them directly.
But if an executor is deliberately ignoring you, there are legal routes you can take to resolve the issue. You may be able to apply for a court order that requires the executor to show you an account of transactions related to the estate.
Or, if you believe the executor is not capable of carrying out the role, you could request that they are replaced. Our expert Wills and probate solicitors can help you to navigate this process.
We work with solicitors who are experienced in handling probate disputes, and we could support you in accessing the inheritance you’re entitled to. To find out more, give our friendly team a call or start your enquiry online.
