Beneficiaries are either provided for in the Will or, if there’s no Will, by the provisions in the Administration Act 1969 (see section on ‘What if there’s no Will?’ on Page 30). Before any beneficiary receives what they’re entitled to, all debts and expenses must first be paid from the estate’s assets.
Beneficiaries have the right to receive the share of the estate that’s due to them – in a timely manner. It must be done in accordance with the Will.
Beneficiaries have a right to be kept informed of matters relating to their share of the estate – at all stages of the estate’s administration.
The executors and trustees should give beneficiaries:
It’s important that executors and trustees are open and honest with beneficiaries.
In some cases the estate will turn into a trust if, for example, one of the beneficiaries is under age. The trustees must carry out their responsibilities (see to invest prudently and in the best interests of the beneficiaries, and to keep the beneficiaries informed about the details of their entitlement and
the investment of it. This information should be provided when requested by the beneficiary. Ideally a full report should be made to all beneficiaries on an annual basis on the investment of their share of the estate.
If a beneficiary has serious concerns about the administration of the estate, they can ask for an audit to be carried out.
The Will can specify what age a beneficiary must be to receive a share of the estate. If the Will doesn’t say this, then the share is distributed when the beneficiary turns 18. This is different from the usual ‘age of majority’, which is 20 years old.
If the beneficiary is under 18 years old, the trustees must invest prudently until the beneficiary is entitled to receive their share. If, however, a beneficiary is incapacitated, their share will need to be held in trust for them beyond their 18th birthday.