Glossary · UK
What is Residuary Beneficiary?
A person or charity entitled to the residuary estate -- whatever remains after debts, taxes, expenses and specific gifts have been paid.
Full Definition
A residuary beneficiary is named in a will to receive the residuary estate: everything left over once funeral costs, debts, administration expenses, Inheritance Tax and all specific or pecuniary legacies have been settled. Because their share is the remainder rather than a fixed sum, the amount they receive can rise or fall depending on the estate's final value and the cost of administration. Where several residuary beneficiaries are named, the will usually splits the residue into shares or percentages. If a residuary gift fails -- for example, the beneficiary dies first and there is no substitute -- that portion may pass under the intestacy rules. Residuary beneficiaries typically have the strongest interest in how the executors run the estate and are generally entitled to see the estate accounts. The 40% Inheritance Tax charge (36% where 10% or more passes to charity), nil-rate band of GBP 325,000 and residence nil-rate band of GBP 175,000 all affect how much residue remains.