QLD Executor of Will Wants Money Back After Distribution

[Michelle84]

My father passed away in May. His sister/ my aunt is executor of will. She has distributed the money prior to completing the last tax return. She is now saying she did not hold on to enough of the money to pay this tax return. She wants us to give back the money.

Do we legally have to give her anything? Is this her liability as executor? The only reason tax needs to be paid on the superannuation is because she is not a dependent and is over 65.

 

[Sophea]

Hi Michelle84,

Beneficiaries are actually not "presently entitled" to any distributions of income unless all other liabilities have been paid. Therefore, the executor distributed monies that were not yet owing to you. Check out the ATO website on this issue: Paying tax on the income of a deceased estate | Australian Taxation Office

In any event, the tax needs to be paid. If the executor had not distributed the estate early you would have received less and would have had the tax deducted from what you received anyway, so it doesn't really sound fair that the executor have to pay out of her own pocket while you gain a windfall. I doubt a court would order her to pay the tax personally despite her error. Therefore I would simply pay back what she is asking and request receipts for all payments of tax made.

 

[Michelle84]

Yeah I guess that is one way of looking at it.

I guess I'm still hung up the on the fact that for the past 20 years, my aunt and half uncle were not in the will, then they pressured him and cried poor so he changed his will to include them in equal shares 4 weeks prior to death. I believe he was not in the right frame of mind- pain, narcotics and daily marajuarna use.

As soon as probate was granted my half uncle asked my aunt for 54k and she gave it. This made splitting the money difficult too. I believe he was pestering for the rest of it as well.