What is Executor’s Commission?
An executor is generally entitled for their ‘pains and troubles’ of administering a deceased estate. “Pains” is the responsibility and anxiety to which an executor is put in the administration. “Trouble” depends on the work which is actually performed by the executor.
Commission is paid as a lump sum in addition, usually in addition to any other benefit from a will.
How much do executors get paid?
The amount of commission an executor will be paid ranges from 1 – 3% of the corpus of the estate. The corpus means the assets of the estate less all liabilities. In addition, an executor may earn up to 6% of income earned during the administration.
An executor does not need to accept remuneration for their services.
Case Study: Paul is the executor of his late mother’s estate. Estate assets include a house, several parcels of shares and a motor vehicle totaling $1.5 million, all which must be sold. There are 5 beneficiaries of the estate: Paul and his four siblings. Paul engages a probate solicitor to help complete the legal side of the deceased estate administration. With the assistance of his lawyers and other agents, Paul sells the property, pays off the mortgage, funeral and other estate administration expenses which leaves a corpus of $1 million. Paul is entitled to executors commission of $10,000 – $30,000 which he decides he will waive his right to.
Who decides how much?
An executor’s entitlement to claim commission is recognised in the legislation of most states in Australia:-
- section 68 Succession Act 1981 (Qld)
- section 86 Probate & Administration Act 1898 (NSW)
- section 65 Administration & Probate Act 1958 (Vic)
Pursuant to these sections the court may grant commission to the personal representative as it sees fit.
Factors relevant to the determination of commission include:
- the size of the estate;
- the care and responsibilities required of the executor;
- the amount of time spent by the executor performing her or his duties; and
- the skill shown by the executor.
If you are experiencing difficulties regarding any aspect of deceased estate administration, be it as an executor managing the expectations of beneficiaries or as a beneficiary dealing with a difficult executor, call us for a free immediate consultation with an expert Wills and Estates Lawyer today on 07 3073 2405.
