Understanding Estate Administration – A Plain English Guide

Effective 24 September 2025, the threshold for informal administration under the Administration Act 1969 has increased from $15,000 to $40,000. This long-awaited change (which had not been updated since 2009) brings significant relief for families dealing with modest estates. Administration without a Grant from the Court The increase in threshold allows certain financial assets to be released when someone dies without requiring a formal grant of probate or letters of administration. The process is governed by sections 65(2) and 65(5) of the Administration Act 1969 and applies only to specific institutions and asset types. What assets are covered? The new $40,000 threshold applies to financial assets held by: Superannuation fund trustees Societies Banks Employers Local authorities Trustee corporations Kāinga Ora ACC MSD The Crown These institutions may release funds without probate, provided they are satisfied the owner has died and the recipient is one of the eligible persons listed in section 65(2)(a)–(e). Life insurance policies under section 65(5) are also covered by the new threshold. What is not covered? The increase does not apply to: Shares and debentures (threshold remains $15,000) Non-financial assets such as real estate, vehicles, jewellery or artwork Cryptocurrency, as exchanges are not listed institutions under the Act If these assets are involved, a formal grant is still required. Does it apply to deaths before 24 September 2025? Yes. The Act specifies that the new threshold applies regardless of the date of death, as long as no grant has already been issued. Families may choose to wait until after 24 September 2025 to benefit from the new threshold. Checks and balances Institutions retain discretion and may refuse informal administration. Policies vary and may evolve in response to the change. Practitioners should be aware that institutions are protected under section 65(6) for payments made in good faith. Funeral expenses: are they extra? No. While banks may release funds directly to funeral directors, this is not added to the $40,000 threshold. The prescribed amount is assessed as at the date of death. What does this mean for you? If you are managing a loved one’s estate, or advising on estate planning, the higher threshold may offer a simpler and faster pathway where assets are modest. It may also reduce legal costs in some cases, while also reducing the administrative burden on the High Court. However, it remains essential to have a valid Will and proper estate planning in place – especially as more estates are growing in value or involve trusts, cross-border assets or complex family structures. If you are unsure whether a grant of administration is needed, our succession and estates team is here to help.  

A testamentary guardian is appointed via a Will or Deed to “step into your shoes” as a parent when you die. A testamentary guardian is not appointed to care for the child. That is something quite different and cannot be provided for in a Will. You can read more about testamentary and court appointed guardians in the Care of Children Act 2004.  When should you appoint a testamentary guardian and what do they do? A testamentary guardian is appointed alongside the surviving parent (usually) for input into “the big important decisions” about a child’s upbringing like education (where do they go to school), health (major medical decisions not day to day bumps and sniffles), religion, residence (which country or region do they live in, not a specific house or street), and permission to marry under the age of 18. These rights and responsibilities end when the child attains the age of 18 years or earlier if the child marries, enters a civil union, or lives with another person as a de facto partner.  Why do it? It is worth considering if you have separated from your child’s other parent to ensure your views about upbringing are represented in the event of your death or if you are worried your family will be “cut off” from the child when you die. If you are still happily in a relationship it is probably not necessary to appoint a testamentary guardian as it is likely you can trust your spouse/partner to make good guardianship decisions for your children if you die. If you are worried about what happens if you both die together then you could each say in your wills that “if we both die together, we appoint X as a guardian.” If you are the sole guardian of your child (the other parent has died already) then you should definitely consider appointing a testamentary guardian.  So, who does care for the kids if we die? The surviving parent would usually remain carer for the child unless unwilling or unable or unsuitable. If you have both died it is assumed that the family will rally around the child to take them in. Whomever they live with (which may be the testamentary guardian if appointed or may not be – there is no default assumption) may then file an application for a parenting order providing them day to day care together with guardianship orders if necessary. A testamentary guardian could apply for a parenting order if they wanted to contest day-to-day care or seek contact rights to the child and as they are already a guardian they would not need the leave of the Court to do so. Before an application for a parenting order can be filed, the guardian will normally have to provide evidence that he or she has sought to resolve the matter with the other guardian/s by family dispute resolution unless the circumstances are urgent. The legal test to determine a child’s care arrangements is “what is in the welfare and best interests of the child” so it depends on all the circumstances at the time.  Things to remember: Only one testamentary guardian can be appointed.  The consent of the person to be appointed as a testamentary guardian is not required.  A person appointed as a testamentary guardian cannot decline the appointment. As a guardian of the child, the appointee could apply to the court for an order for his or her own removal. Another guardian could also apply for removal of the testamentary guardian.  A testamentary guardian has the same rights and responsibilities as the living parent/guardian but only upon the death of the appointor. They have no say in the upbringing of the child prior to that parent’s death.  By appointing a testamentary guardian you are not appointing somebody to care for your child if you die. 

Being appointed as an Executor in a Will is a significant responsibility.  You are entrusted with administering the estate in accordance with the Will and New Zealand law. This includes identifying and managing all assets, which may range from bank accounts and property to investments.  There is also the emotional side of supporting a family, and dealing with your own grief in the process. We work closely with executors to support them as much as they need. The following outlines the key steps taken by executors/legal advisors as part of the estate administration process. 1. Locate the Will and Confirm Your Appointment Your authority to act comes from the Will.  Once you have located the original signed Will and confirmed you are named as executor, you are responsible for securing and protecting the estate’s assets. If more than one executor is appointed, all executors must act jointly.  Asset holders will require consistent instructions from all executors before releasing information or funds. It is very important that you keep the Will in a safe place and do not alter or mark it in any way. 2. Apply for Probate Before you can access or deal with most estate assets, you will need to obtain Probate.  This is a High Court order confirming that the Will is valid and that you are authorised to act as executor. Most asset holders — including banks, investment managers, and mortgage trusts — will not release or transfer assets until Probate has been granted. 3. Notify All Asset Holders You must identify the assets and liabilities of the estate such as bank accounts, property, insurance, shares, income streams and debt. Once Probate is underway, you should contact each organisation where the deceased held assets. This may include: Banks KiwiSaver providers Investment managers Share registries Insurers Each organisation will advise you of the documentation required and the options available for dealing with the asset. This typically includes providing: A certified copy of the death certificate A copy of the Will Identification for all executors A copy of the Probate order once granted If the estate includes fixed term or income producing investments, the provider will confirm how interest or returns are treated and whether early withdrawal is possible. Investments held in joint names pass jointly by survivorship in most cases. Some other assets transfer to a named beneficiary automatically on death, i.e some life insurance policies. KiwiSaver can never be held jointly, and will always pass to an estate to be distributed pursuant to a Will (or the rules of intestacy). You must also notify the beneficiaries of the Will and make relevant disclosures to them.  Your estate’s lawyer can assist with this. 4. Protect and Manage the Estate\'s Assets Any assets should be secured so far as possible.  For example, if there is a property, you should check who has access to keys, that the insurance is up to date and that any expenses (such as rates, water and power) are up to date. Executors have a legal duty to preserve the value of the estate.  This includes: Confirming balances and ownership detail Reviewing maturity dates for fixed‑term investments Ensuring income continues to be paid to the estate Making prudent decisions about whether to retain or redeem investments Any decisions must be made in the best interests of the beneficiaries. 5. Pay Estate Debts and Expenses Before distributing any assets, you must settle the estate’s liabilities, including: Funeral expenses Taxes Professional fees Outstanding debts Funds released from investments or bank accounts may be used for these purposes once paid into the estate account. Executor expenses In New Zealand, the general rule is that an executor cannot charge for their time unless there is a specific clause in the Will allowing them to do so.  However, executors are entitled to reimbursement for their reasonably incurred expenses.  This could include if you were to pay the insurance for an estate property or a rates bill to avoid a late fee. 6. Distribute the Estate Once debts have been paid and the estate is ready for distribution, you may: Redeem investments and distribute the proceeds, or Transfer investments to beneficiaries (if permitted by the Will and accepted by the provider). Asset holders will require formal written instructions from all executors before releasing or transferring funds. Risks facing executors As executor, you are required to act with neutrality and independence, while doing your best to follow the wishes of the Willmaker.  Potential arguments can arise between family members who may be unhappy with the terms of the Will. Before making distributions, you should seek advice from your estate’s lawyer to ensure you are not exposing yourself to undue risk.  You also should take advice as to how to manage any conflict between the beneficiaries and how to deal with potential claims.  You can attempt to reach agreement with all beneficiaries as to how assets are to be distributed, but if there is no agreement it will be for a Court to decide. Due to potential personal liability, it is strongly advised that the estate’s assets are generally not distributed until the expiry of six months.  In practice, estates can take several years to distribute. 7. Maintain Accurate Records Executors must keep clear and complete records of: All correspondence with asset holders Balances and income received Decisions made regarding retention or withdrawal Final distribution amounts These records form part of your executor’s account and help protect you from personal liability. 8. Key Considerations for Estates with Managed Investments Where the estate includes investments such as those held with mortgage trusts, fund managers, or other investment providers: Fixed‑term investments may not be immediately accessible. Executors should check maturity dates early to manage timing expectations. Interest or returns may continue to accrue after death. Providers will confirm how this is handled. All executors must sign instructions. Investment providers cannot act on partial or individual directions. Early withdrawal may require approval or may not be available. Executors should consider whether early redemption aligns with their duty to act prudently. Administering an estate can be complex, particularly where investments or fixed‑term assets are involved. Understanding your obligations and the steps required will help ensure the estate is managed efficiently and in accordance with the Will. Executor’s Decision Making Executors are appointed by the Willmaker to carry out their intentions.  It is important to always consider the intention and wording of the Will before making any decisions.  Those close to the deceased will want to be involved in any decisions and this should be welcomed.  The executor will work as a neutral person making sure that the wishes of the deceased are upheld eg. if they want to be cremated making sure that this is done, or the specific bequests are carried out. Where there are intimate decisions that need to be made eg. where to bury the body and the Will will not necessarily specify this – it is the role of the executor to facilitate discussions and agreement between the whānau. What is a Statement to Accompany a Will or a Memorandum of Wishes A Statement to Accompany a Will is a statement made by the Willmaker explaining any decisions made in the Will.  It provides more of an understanding around what the intention of the Willmaker was at the time of drafting and signing the Will. The Memorandum of Wishes is similar to the Statement whereby it gives the executor or trustees further instructions with the Will and helps give insight into what decisions they want to be made.  Neither of these documents are legally binding, however, it is useful to read them and consider what they are wanting to achieve. Can I get out of it? If you are unable or unwilling to be an executor, the next nominated person in the Will can be appointed.  You will need to renounce before you take any steps to administer the estate. If you have accepted the role as executor and the estate administration is ongoing, you cannot simply retire, but rather you have to apply to the Court to be removed (and replaced if required). The role as executor will continue for a long period of time, for example where the estate holds a property and a beneficiary has a life interest to live in it, or there are minor children not due to receive their inheritance until a certain age.  If this is the case and you no longer want to be an executor, then provided the estate administration steps have been completed (gathering of assets, paying debts), then it is possible for an executor, who is now technically a trustee of the estate, to retire and another to be appointed by Deed rather than involving the Court.  Frequently we see executors retire in this situation and an independent trustee or trustee company is appointed to continue the ongoing management of the estate and manage the obligations to beneficiaries. How to get important information The best way an executor can obtain information about the Willmaker’s assets and liabilities would be before death.  If you find yourself aware that you are an executor of an estate, have a conversation with the Willmaker. Where do they keep their bank statements or passcodes if you need to locate them, who is the property insured with?  Make sure that if there are any updates that you are aware of these. It pays to have an updated Will, necessary statements or instructions for the executor and to have regular conversations about what you would like to have happen when you die. Talk to our succession and estates team about your options and to obtain the right advice for you.