If you are the executor of someone’s estate, you will acquire certain records when carrying out your duties. Once you have finished, what should you do with these documents; file them away or dispose of them? Prestige Tax and Trust Services asks: how long should you keep records after death?
As the executor, it will be your job to distribute the assets held within the deceased’s estates to its beneficiaries. Under UK law, you must apply for probate in order to gain the legal right to carry out this task. During this process, you will have to value the estate, so you can work out its inheritance tax obligations, after which you will need to send the relevant inheritance tax forms with your application.
Throughout this process, you will acquire a lot of paperwork. What should you do with it once you have finished serving as the deceased’s executor? You are required to keep certain records after you have valued an estate. This is because HM Revenue and Customs (HMRC) are allowed to ask you for specific documents within 20 years of the date you paid the estate’s inheritance tax.
So which records are HMRC allowed to ask you for within this 20 year period? The paperwork you must keep includes the deceased’s will, copies of any inheritance tax forms, along with their supporting documents and any paperwork which shows how you valued the estate e.g. an estate agent’s valuation. You should also hold onto any paperwork which refers to any unused inheritance tax threshold which can be transferred to the deceased’s spouse or partner.
Furthermore, keep any ‘final accounts.’ This refers to documents which illustrate how you distributed the deceased’s estate to beneficiaries. This paperwork can include receipts showing debts paid e.g. electricity bills, receipts which show any expenses you incurred when dealing with the estate and any letters you received from HMRC which confirm that you paid inheritance tax. It also includes written confirmation from beneficiaries that they have received any assets that they were supposed to inherit.
Prestige Tax and Trust Services
Therefore, we would strongly advise that you keep any record you acquire when administering someone’s estate for 20 years after you pay inheritance tax to HMRC. This is just one of the considerations of being an executor, which can be a complex role to undertake. You may wish to enlist the aid of experts to help you handle the duties of executorship. Prestige Tax and Trust Services has the experience and legal acumen needed to ensure you handle your executorship tasks effectively.