Beneficiaries in an estate or trust have minimal active responsibilities, as the primary legal and administrative duties fall on the executor or trustee. The main responsibilities of a beneficiary are generally related to managing their own inheritance and adhering to specific conditions.
While beneficiaries primarily receive from the estate, they do have certain responsibilities:
A beneficiary collects what was given to them. They do not have to take part in the responsibilities as an executor does. Beneficiaries can also acquire a trust from the deceased individual. There may be benefits to trusts due to varying types of trusts.
As a beneficiary, you have a right to information before the estate is distributed, so you can be kept up to date with the administration of the estate. The person in charge of administering the estate is called the executor when there is a Will, or the administrator when there is no Will.
An executor withholding an inheritance from a beneficiary is only legal if the distribution hasn't yet come due. This typically means the final accounting and petition for final distribution have either not been filed with the court, are still pending approval or are under dispute.
The executor has a fiduciary duty to ensure that beneficiaries know the estate's assets. Beneficiaries should be provided with an inventory of the estate assets, which may include real estate, personal property, bank accounts, and other valuables. Executors must also inform beneficiaries about estate debts.
The biggest mistake people make with wills is failing to keep them updated after major life changes (marriage, divorce, new children, significant assets), leading to outdated wishes; other huge errors include using vague language, choosing the wrong executor, not understanding that a will doesn't avoid probate, failing to meet legal signing requirements, and not telling anyone where the will is located. In essence, many people either don't make a will or create one that becomes invalid or ineffective over time, causing chaos and family disputes.
Ignore the interests of beneficiaries.
An executor isn't allowed to choose who gets what from the estate.
Common mistakes in beneficiary designations include not accounting for all your assets, confusing designations and wills, and failing to regularly review and update designations based on life changes.
There's no set rule for how often you'll need to update beneficiaries on the administration of the estate. Many executors choose to set expectations in the beginning by letting beneficiaries know how frequently they plan to provide information.
A direct heir (also known as an heir apparent or lineal heir) is who would be considered the decedent's next of kin, and they are first in line to inherit through intestate succession. If the decedent had been married when they died, their direct heir most likely would be their surviving spouse.
As a beneficiary, you have the right to be informed about the administration of the estate, including receiving a copy of the will and being notified of your entitlement. You also have the right to ask questions and, in some cases, request a formal inventory of the assets.
Unless the trust is revocable by someone else (like a revocable living trust while the settlor is still alive), the beneficiary has the following rights, in addition to any rights listed in the trust: The right to receive notice of the existence of the trust. The right to receive a copy of the trust.
Beneficiaries do not have a right to see the will simply because they are beneficiaries. However, once probate has been granted, the will becomes a public document and anyone can access a copy by applying to the Probate Registry.
An executor needs to act impartially, as well as defend the estate and act in the best interests of the beneficiaries. As their authority comes from the Will itself and the law, their powers are also limited by them. They cannot override a Will's terms and the testator's intentions.
Below are 9 of the most common mistakes your Independent Executor can make.
Legal Challenges: If someone can prove that the beneficiary designation was made under duress, fraud, or undue influence, a court may override it. This isn't easy to do, but it's not impossible. Creditor Claims: In some cases, creditors may be able to claim assets before they're distributed to beneficiaries.
The 7 year rule
No tax is due on any gifts you give if you live for 7 years after giving them - unless the gift is part of a trust. This is known as the 7 year rule.
A common mistake many Australians make when preparing their estate plan is forgetting about their assets held in other countries. If you're someone who holds assets overseas, make sure your will takes into account all of your assets – not just those within Australia.
The Bottom Line. An executor, or personal representative, must follow the deceased person's wishes as they are laid out in the will. Anything done that is not consistent with the will can result in the beneficiaries taking legal action.
Beneficiaries can only be removed when there has been an exercise of power in good faith by a trustee, in accordance with the trust deed. Any attempt to remove beneficiaries for a purpose other than those specified in the trust deed may cause a fraudulent exercise of trustee power, making the removal void.
Basic process for how to remove an executor
Obtain the consent of all beneficiaries: Unless the will specifically provides otherwise, all beneficiaries must agree to the removal of an executor. If any beneficiary objects, the court may still allow the removal if it is in the best interests of the estate.
Tax-free lump sum payments (where the individual dies under 75) must be made within two years of the scheme administrator being notified of the death of the individual. Any lump sum payments made after the two-year period will be taxed at the recipient's marginal rate of income tax.
If you already have some legal experience, you might see how an asset protection trust is excellent for protecting assets from litigation and creditors. By removing ownership of the valuable assets in question away from you and your immediate family members, you make those assets practically untouchable…
The simplest way to give your house to your children is to leave it to them in your will. As long as the total amount of your estate is under $15 million (per individual, in 2026), your estate will not pay estate taxes.