Bereaved Families can expect to pay more in Probate fees from April 2019.

PROBATE FEE INCREASE

Next month (April 2019) anyone applying for probate in England and Wales may be subject to a new

Bereaved Families can expect to pay more in Probate fees from April 2019.

banded fee structure.

In the UK when someone dies their assets are frozen until the executor or administrator is granted Probate. This grant is a legal document from the court allowing the executor authority to deal with the deceased person’s estate. In order to apply for a Grant of Probate, fees are paid to the Government.

Currently, when the net estate value ( i.e. after funeral and debts are paid) is over £5000 the probate costs are a flat rate of £215 (£155 if using a solicitor), regardless of the value of the estate.  If the net estate is under £5000 there is no fee.

Last November Parliamentary Under Secretary of State for Justice, Lucy Frazer, announced they were pursuing a “banded structure” for probate fees based on the value of the estate.

The new charges

The good news is that lower value estates are being taken out of this fee with the estate value threshold being lifted from £5000 to £50000. So any bequeathed estates valued at under £50,000 will not have to pay a probate fee. By doing this they estimate they will be lifting 25,000 estates annually out of fees altogether.

However, this will be of little consolation to most devisees as according to figures published by the UK Price House Index the average house value in the UK is £230,776*

The new fee structure which will apply to England and Wales only and will see estates over £50,000 subject to a fee set on a sliding scale with a maximum fee of £6000 payable on estates worth more than £2m.

• Source – House of Commons Probate Fees Briefing Paper 07929 12, February 2019

The reasoning behind this increase is the need to modernise and upgrade the court’s system, with a 1 billion pound investment. These plans include enabling people to apply online for a grant of probate which launched January this year. To find out more about applying for probate online read our blog: Digital Meets Probate

Launching the new system Justice Minister Lucy Frazer said: “This new banded fee model represents a fair and more progressive way to pay for probate services compared to the current flat fee and reflects our commitment to protecting access to justice by ensuring we have a properly funded and resourced courts system”.

“We are also confident these fees will never be unaffordable”.

However it is, still unclear how executors will pay these fees as the estates assets are frozen until probate is granted.

It’s also questionable how this fee on more valuable estates can be justified as the amount of work required to be done by the court is the same irrespective the size of the estate.

With property prices at an all-time high, these fee’s, which some consider a “stealth” tax will give the government’s coffers a healthy boost but will hit already grieving families hard.

If you would like to find out ways you can reduce the value of your estate therefore reducing your Inheritance Tax and Probate fees get in touch with us at Just Wills and Legal Services 01342 477102 to book a free consultation.

This article is for general information only and does not constitute legal advice. You should not rely on this information to make (or refrain from making) any decisions. Always obtain independent, professional advice for your own particular situation.

*UK House Price Index December 2018 figures.