Significant Increase in Probate Fees
The Ministry of Justice have released their proposal for the increase of probate fees from May this year. The proposal is currently subject to Parliamentary approval.
Currently, the fee for the application of the Grant of Probate is a flat rate of £215.00 for individuals and £155.00 for those applying through a solicitor. If the estate is worth less than £5,000.00 then no fee is payable.
The proposal would see this increase from £5,000.00 to £50,000.00; any estate under this value would not be subject to a Probate fee. The fee for estates which are valued in excess of £50,000.00 will increase on a sliding scale in accordance with the value of the estate, as set out below:
|£5,000.00 – £50,000.00||No fee payable|
|£50,000.00 – £300,000.00||£300.00|
|£300,000.00 – £500,000.00||£1,000.00|
|£500,000.00 – £1 million||£4,000.00|
|£1 million – £1.6 million||£8,000.00|
|£1.6 million – £2 million||£12,000.00|
Although many involved in the Government’s Consultation on this issue were opposed to fees being charged based on the value of the estate, rather than a fixed fee, the Government is pressing forward with these changes.
The proposed fees are likely to pose a number of problems to the administration of estates; not least that the fees is likely to be beyond what many executors will be able to pay from their personal finances or even cash available in the estate. However, there will be options available to Executors and those planning the protection of their estates both to manage the issues faced by increased fees and to reduce the impact on the value of the estate. For example, certain trust mechanisms may be suitable. However, there are implications which need to be considered before any arrangements are entered into and therefore receiving expert legal advice both prior to and following a death is essential.