Changes to Probate Fees
How this effects your estate
It has been announced that, subject to Parliamentary approval, there will be a significant increase in the fees that are charged by the Probate Registry for the processing of applications for grants of representations. It is proposed that this change takes effect from 1st May 2017.
A grant of representation is a legal document which allows the Executor(s) or administrators the authority to deal with the deceased person’s assets (i.e. property, money and belongings). Probate allows families to access the money that has left for them and to sell properties and other assets. Probate fees are separate to Inheritance Tax, and may need to be paid even in instances where an entire Estate is left to a spouse and there is no Inheritance Tax to pay.
Probate fees are currently a £215 flat fee if applied for by the friends or family of the deceased, or £155 if a solicitor makes the application. The fees are currently charged on any estate worth more than £5,000.
The new fee structure will be a sliding scale based on the value of the deceased’s estate as follows:
|Value of estate (before inheritance tax)||Proposed Fee|
|Up to £50,000 or exempt from requiring a grant of probate
|Exceeds £50,000 but does not exceed £300,000
|Exceeds £300,000 but does not exceed £500,000
|Exceeds £500,000 but does not exceed £1m
|Exceeds £1m but does not exceed £1.6m
|Exceeds £1.6m but does not exceed £2m
The initial threshold for Probate fees being raised to £50,000 means that approximately 57% of estates will pay nothing in respect of probate fees. However, anyone whose estate is worth more than £50,000 will pay significantly more. These fees are payable before the estate is distributed to the beneficiaries so this could mean that some people will need to borrow in order to have sufficient funds to pay.
This rise in Probate fees could have an effect on people who have Life Interest Trusts or Discretionary Will Trusts in their Wills as their property may be owned as Tenants in Common. This means the trust will have to be set up on first death and so probate will be required to effectively deal with the property.
For any questions about Probate Fees, Wills and other legal services, get in touch with an expert at Redstone Wills on 0808 281 1545.