Are Probate Fees increasing?
In November 2018, the Government announced that probate fees would be paid as a sliding scale which will depend on the value of the estate. The Government were planning to implement the change from 1st April 2019 however it appears the changes still need to be approved by Parliament and no date has been set for this to happen.
What is Probate?
When someone dies, all their cash, property and possessions need to be collected in and distributed in accordance with their Will or under the rules of intestacy (if they do not have a Will).
If the deceased left a Will, the person appointed as their Executor will be responsible for collecting in the assets. In order to do this, they may need to apply for a Grant of Probate. This is a legal document which confirms the Executor has the authority to deal with the deceased’s assets under the Will.
If there is no Will, the next of kin will need to obtain a Grant of Representation. This is the document which proves their authority to administer the estate.
Both the Grant of Probate and Grant of Representation are commonly known as “Probate”.
In order to apply for Probate, the Executor or Personal Representative need to apply to the Probate Court and pay the fee which is currently £215 (£155 if processed through a solicitor) and this is payable on an estate valued at £5,000 or more.
What are the changes?
The Government have now proposed on increasing the fees so they will depend on the amount the estate is worth. This will be the same whether you use a solicitor or apply independently. The proposed fees are as follows:
Estate value range: £0 - £50,000
Probate Fee: £0
Difference in price:A saving of £215
Estate value range: £50,000 - £300,000
Probate Fee: £250
Difference in price:An increase of £35
Estate value range: £300,000 - £500,000
Probate Fee: £750
Difference in price:An increase of £535
Estate value range: £500,000 - £1 million
Probate Fee: £2500
Difference in price:An increase of £2,285
Estate value range: £1 million - £1.6 million
Probate Fee: £4000
Difference in price:An increase of £3,785
Estate value range: £1.6 million - £2 million
Probate Fee: £5000
Difference in price:An increase of £4,785
Estate value range: £2 million +
Probate Fee: £6000
Difference in price:An increase of £5,785
Why are the probate fees increasing?
The justification for increasing the fees is a result of an Office for Budget Responsibility report which states that the new probate fee structure is expected to generate £155 million a year in additional revenue. These funds will then be used for the running of the courts and tribunal services.
What to do about it?
Probate fees will be based on the value of assets in the deceased’s sole name and those held by the deceased jointly as tenants in common. Joint assets held as joint tenants such as bank accounts should not be taken into account. The value of some life insurance policies and pensions which pass outside of your estate may be disregarded when calculating the fees as well.