There is currently a delay in the Government proposals to change the structure of probate registry fees in England and Wales which were set to come into force in April 2019. Dubbed the ‘stealth tax’, probate fees – paid when administering someone's estate after they die – are due be paid as a sliding scale depending on how much the estate is worth, rather than as a flat fee.
As at the beginning of May, the changes still need to be approved by Parliament, who say they will bring the changes before the House of Commons as soon as Parliamentary scheduling allows - but no date has yet been set for this to happen.
Caroline Billings, Hatch Brenner Partner and Private Client expert commented: “With the changes to the structure of probate fees still in the pipeline for the near future, we would advise any Executors to get their applications in sooner rather than later – especially if the estate is of a high value.”
So, what changes are on their way?
The current Government proposals are set out below:
Sliding scale of probate registry fees
- For assets worth less than £50k, there will be no charge.
- If the total assets are worth from £50k up to £300k, then the fees will be £250.
- For estates worth from £300k – £500k, the fees will be £750.
- For estates worth £500k upwards, the fees jump from £2,500; up to a maximum charge of £6,000 for estates worth £2 million or more.
This is a rise of £5,785 on the current flat fee of £155 (where a solicitor is used to apply for the grant of representation) or £215 (where an applicant applies in person).
In a written statement to Parliament, the Parliamentary Under-Secretary for the Ministry of Justice Lucy Frazer MP said: "The proposed 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. The cost of the fee is recoverable from the estate and executors have several options to fund it. Moreover, the Lord Chancellor retains a power to remit a fee if he considers there are exceptional circumstances."
Making the process cost effective
Caroline Billings said: “Whilst we are seeing an increased number of clients wanting to undertake DIY Probate to save costs, using a Solicitor remains one of the most flexible options to guide Executors through the probate process. Speaking to an expert Probate Solicitor early on can really make a difference. For example, jointly held property assets are not included as part of the probate estate for an individual. Would transferring a property into joint ownership in advance help ensure the estate falls into a lower band in respect of fees owed upon an individual’s death?
“Funeral expenses will also be deductable from the estate – would spending slightly more on the funeral arrangements therefore mean it is possible to sit in a lower band overall for fees due?
“A fixed fee probate is a great option if you have the time to work through the majority of the paperwork yourself. Ensure to get as much paperwork together in advance as you can including birth and marriage certificates, and wills. Shop around and question how much help and input you will need.”
If you would like any advice regarding Probate or Estate Planning, contact Caroline Billings at firstname.lastname@example.org or call 01603 660 811. We can guide you through the process or we can deal with all the requirements depending on your needs.