MalaysiaWills

Estate/Trust Administration

What is Estate Administration ?

Estate Administration is a process of unfreezing the deceased estate starting from his/her death up till distribution to the family member. When a person passes away, the assets and debts he leaves behind are referred to as his estate. Most people are under the mistaken impression that the deceased’sbeneficiaries receive the assets almost immediately upon death or as soon as theprobate or letters of administration has been obtained. This is certainly not the casebecause there is a process to follow.

What is the Job scope involved in Estate Administration ?

Estate Administration is done by either executor or administrator. There are many matters to be settled by your executor before distribution. Where there is a valid Will, the personalrepresentative is referred to as the executor and where there is none, the administrator. This include collecting all immovable and movable assets [including bank accounts, vehicles, shares in companies, unit trusts, house etc]; settling the debts of the deceased [including income tax and loans]; and applying for grant of probate and submission of the relevant documents to the High Court; dealing with government authorities and financial institutions.

What are the Fees on Estate Administration ?

The responsibility of an executor may sound easy but  it is not the case.The role of the executor or administrator is similar to that of a liquidator in thewinding-up of the company. Even for experienced personal representatives, theestate administration process may span years. Personal representatives can befamily and friends of the maker of the Will or a trust corporation providingprofessional estate administration services.

Estate Administration Fee
Movable & Immovable
First RM 1 Million	1.8% or min RM 5,000 per annum
Next RM 9 Million	1% per annum
Remaining Value exceeding RM 10 Million	0.5% per annum

Note: Charged based on remaining assets, not total asset

What is Trust Administration ?

Trust administration involves overseeing the assets held within a trust. A trust is a form of legal property ownership in which an ownership interest in real or personal property is split. Trusts are commonly created as an estate planning tool, and the trust administrator then oversees the distribution of assets within the trust according to the wishes of its creator.

A trust administrator must treat all beneficiaries equally and fairly. Even if trust instructions require special treatment for one beneficiary, laws still require that the trust administrator protect the interests of all beneficiaries.

What is the Job scope of Trust Administration ?

When a trust is created, in addition to naming the beneficiary or the person who is entitled to use the trust assets, a trustee must also be named. That trustee is responsible for trust administration. This means he is responsible for protecting the assets in the trust and ensuring they are used according to the wishes of the individual who established the trust.

The duties involved in trust administration vary depending on the nature of the trust created. It is common, for example, for a person to create atrust in which money is left to a child and then distributed to that child to pay educational expenses or when the child reaches a certain milestone. In such a situation, the trust administration duties involve ensuring that the assets are protected until the child reaches maturity and/or ensuring the money in the trust is used only for qualified educational expenses.

The trustee has a fiduciary duty when performing the trust administration. This means he owes the highest obligation to protect the assets in the trust and the interests of the beneficiaries. He cannot divert assets from the trust into his own name, put the assets at risk in any way or otherwise behave in such a manner that interferes with the purpose of the trust as determined by the trust’s creator.

What are the Fees on Trust Administration ?

Trust Administration Fee
Movable
First RM 1 Million	0.75% or min RM 2,000 per annum
Next RM 9 Million	0.5% per annum
Remaining Value exceeding RM 10 Million	0.25% per annum
Immovable
Income Bearing	1% or max RM 6,000 per title
Non-Income Bearing	RM 2,000 per title

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