Who Pays Estate Administration Costs In Australia?
Generally, reasonable administration costs are paid from the deceased estate, not personally by the executor or beneficiaries. However, an executor may need to arrange payment before estate funds become available. Understanding who pays estate administration costs in Australia can help executors manage these obligations without assuming they must personally cover every bill.
Who is responsible for estate costs?
The executor named in the will is responsible for managing the estate. If there is no executor, an administrator may be appointed.
Their responsibilities can include identifying assets and debts, applying for probate, lodging tax returns, maintaining property and distributing the remaining assets.
Legitimate administration costs are generally estate liabilities. These may include:
- Probate and court filing fees
- Funeral and burial costs
- Solicitor and accountant fees
- Property valuations
- Insurance, rates and essential repairs
- Costs associated with selling assets
- Reasonable executor expenses
Who pays probate fees in Australia?
Probate is the court process that confirms a will and the executor’s authority to administer the estate. Applications are made through the Supreme Court in the relevant state or territory.
These fees are normally treated as estate administration expenses. They may initially be paid from available estate funds or advanced by the executor, solicitor or another funding source.
The amount depends on the jurisdiction and sometimes the estate’s value. Fee structures can change, so executors should check the relevant court website. For example, the Supreme Court of Victoria explains its current court fees, including the classification of executors and administrators.
Probate is not required for every estate. Requirements may depend on the assets involved and the policies of individual asset holders.
Who pays funeral costs from the estate?
The person who arranges the funeral may be contractually responsible for paying the funeral provider. If sufficient estate money is available, reasonable funeral expenses can generally be reimbursed from the estate.
Some banks may release money directly from the deceased’s account after receiving documents such as an invoice and a death certificate.
Legal Aid NSW guidance on paying for a funeral explains that the organiser is responsible for the account, but estate funds may cover it where sufficient money is available. Executors should also check for funeral insurance or prepaid arrangements.
Who pays legal fees for an estate?
Reasonable legal fees connected with obtaining probate and properly administering an estate are generally paid from estate assets.
Different considerations can apply to litigation. If an executor acts unreasonably, breaches their duties or becomes involved in unnecessary proceedings, a court may make a costs order affecting them personally. Beneficiaries in a dispute may also have to pay their legal costs unless a funding arrangement or court order provides otherwise.
Executors should obtain a written costs agreement and confirm which work will be charged to the estate.
Help for executors managing costs
An estate can own valuable assets while having little accessible cash. Probate, legal work, insurance and maintenance may still need to be paid before the property can be sold.
Options for managing this gap include:
- Asking the deceased’s bank to pay an eligible funeral invoice
- Using accessible estate funds
- Discussing deferred payment with professional advisers
- Recording any personal payments for potential reimbursement
- Considering estate funding where appropriate
Executors should confirm that the estate can meet its liabilities before distributing assets. An executor who distributes assets improperly may face personal liability.
Manage estate costs with JustFund
An estate may have sufficient assets but no cash available for immediate expenses. This can make probate fees, funeral costs, legal invoices and property maintenance difficult to manage.
JustFund provides estate funding for eligible executors, administrators and beneficiaries. Approved funding can cover qualifying estate expenses, with repayment deferred until the estate is finalised. Funding is subject to assessment, interest, fees and applicable terms.
If estate expenses are creating financial pressure, apply for estate funding or contact JustFund to discuss the support available.
FAQs
The estate generally bears reasonable costs associated with its proper administration. The executor arranges payment and maintains the relevant records.
Not necessarily. Executors are not generally expected to personally bear legitimate estate costs, although they may temporarily advance money when estate funds are inaccessible. Advice should be obtained before making significant payments.
Yes, provided the expenses were reasonably and properly incurred for the estate. When considering who pays for executor expenses, executors should retain invoices, receipts and payment records. Reimbursement is separate from executor commission, which may require authority under the will, beneficiary agreement or court approval.
If the estate has insufficient assets to meet its debts, the executor should obtain legal advice before paying creditors or making distributions. Insolvent estates are subject to payment priorities, and handling assets incorrectly may create personal liability.
If sufficient assets exist but cash is inaccessible, JustFund’s estate funding may help eligible executors cover approved expenses until estate proceeds become available.