The Government is planning to change probate fees according to the value of the estate. The consultation period opened on 18 February 2016 and is due to end on 1 April 2016.
The proposed probate application fees are as follows:
- £300 for estates worth more than £50,000 and up to £300,000
- £1,000 for estates worth more than £300,000 and up to £500,000
- £4,000 for estates worth more than £500,000 and up to £1 million
- £8,000 for estates worth more than £1 million and up to £1.6 million
- £12,000 for estates worth more than £1.6 million and up to £2 million
- £20,000 for estates worth more than £2 million.
This follows last year’s increases which set probate application fees through a solicitor at £155 and personal applications, or those not through a solicitor, to £215.
Currently the fee is chargeable on any estate worth more than £5,000. This threshold will rise to £50,000, meaning that 57% of estates will pay nothing under the new proposals.
However, anyone with an estate worth more than £50,000 will pay considerably more. The change is set to raise £250 million for the courts service.
Justice Minister Shailesh Vara said court fees are never popular, but that the maximum £20,000 fee would only be paid by the very wealthiest estates, while charges would never be more than 1% of its total value.
Given the sharp rise in property prices in many parts of the UK in recent years many families could find themselves hit by the higher charges when a loved one passes away.
It is thought that the rise will hit farmers particularly hard. While farms are high in value putting them in the higher bands, cash is often short meaning that some may need to borrow cash against the assets in order to pay the fee when applying for grant of probate. There is also a danger that property may be transferred during lifetime in order to save these costs, causing farmers financial instability in later years.
Jonathan Smithers, president of the Law Society, said: ‘We support the Ministry of Justice’s aim of a simpler, more streamlined process for probate users. Many people would regard a progressive fee structure as a fairer way to charge for the service, but the fees proposed for high value estates do not bear any relation to the work or value involved. We will put forward our arguments in our written response to the consultation.’
Mayo Wynne Baxter offers quality advice and assistance in relation to the administrations of estates, as well as all aspects of wills and probate. Please contact a member of the Probate, Trusts and Wills Team and benefit from their insight and advice today.