Is an Executor Entitled to Be Paid in British Columbia?

Being an executor is real work. You may be listing assets, paying debts, filing tax returns and distributing the estate over many months. It is natural to ask whether you are allowed to be paid for that effort, or whether you are expected to do it for nothing.

In British Columbia the answer is generally yes, but within limits and with oversight. This article explains what the Trustee Act provides, how the amount is approved, and what records help you.

This article covers the law of British Columbia.

What the law says about paying an executor

Executors and administrators are entitled to a fair and reasonable allowance for their work. The allowance cannot be more than 5% of the gross aggregate value of all estate assets, including capital and income. The amount is fixed by the Supreme Court, or by a registrar if the court directs.

That wording matters. You do not simply pay yourself a percentage and move on. The law treats the figure as a ceiling, not a default, and someone other than you decides what is fair.

Compensation, expenses and other amounts

Payment for your time is not the same thing as repayment of money you spent. Remuneration is paid on top of reimbursement for expenses actually incurred. Keep the two separate in your records.

• Remuneration: the allowance for your work as executor, up to the 5% ceiling.
• Expenses: costs you actually incurred for the estate, reimbursed in addition to remuneration.
• Care and management fee: a trustee may also apply each year for a fee of up to 0.4% of the average market value of the assets.

How the amount is approved

A personal representative, or anyone interested in the estate, may apply for an order passing the representative's accounts or fixing their remuneration. The application is brought under Rule 25-14, or under Rule 8-3 if all other interested persons consent. A representative who applies must file an affidavit in Form P38.

On a passing of accounts, the Form P40 statement of account must set out the estate's assets and liabilities, capital and income transactions, distributions and how remuneration was calculated. The court may refer the accounting to a registrar, who certifies the result in Form P39.

If a registrar's order or certificate fixes the compensation, the court can review it if an application is made within 14 clear days after it is entered or filed. Unless varied, it binds the executor or administrator.

Government guidance says executors must prepare accounts showing the estate's assets, receipts, disbursements and distribution, and must have those accounts approved by the court or by the people receiving the assets. Under the Trustee Act, an executor, administrator or trustee under a will must obtain an order passing their first accounts within 2 years from the grant of probate. If a beneficiary serves notice requiring it, accounts must then be passed each year within one month of the anniversary. The court-passing requirement does not apply if all beneficiaries approve or consent to the accounts in writing. Whether it applies in your situation is worth confirming with a lawyer.

When the will sets the fee

Sections 88 and 89 of the Trustee Act do not apply where the will or other trust instrument sets the allowance. If your will says how the executor is to be paid, read that wording first. A will might also say nothing, in which case the Trustee Act allowance is the starting point.

Whether a particular clause sets the allowance, or only mentions payment in passing, can be a question of interpretation. A lawyer can read the clause and tell you how it fits with the Trustee Act.

What to do next

• Check the will for any clause about executor payment before assuming the Trustee Act applies.
• Keep a dated log of the work you do, and keep receipts for every expense.
• Record expenses and remuneration separately.
• Talk to the beneficiaries early about how you plan to be paid, and consider asking for their consent in writing.
• Find out how the amount will be fixed before you take any payment, since the Supreme Court, or a registrar if the court directs, fixes it.
• Ask a lawyer or accountant about the tax treatment of any payment you receive.

If you are unsure how to handle a question about managing the estate, an executor may petition the court for its opinion, advice or direction without starting any other proceeding. A lawyer can explain whether that step makes sense for you.

Frequently asked questions