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Probate Fees Increase Proposal – A New Tax on Death?

November 2018

This article explores the new proposed fees for obtaining a Grant of Probate in England and Wales announced by the Government this month.

This month the Government announced their new proposed fees for obtaining a Grant of Probate in England and Wales. Obtaining a Grant of Probate is often a crucial part of estate administration - it is a document that confirms the authority of the executors to deal with assets in a deceased's estate.

The proposal

The proposal would see the current flat rate system of either £155 or £215 (the lower rate being for those who apply via a solicitor), replaced with a tiered system based on the value of an estate from April 2019. Currently, those estates with a value under £5,000 pay no fee.

The table below details the proposed fees:    

Value of estate (before inheritance tax)

Proposed Fee  

Up to £50,000 or exempt from requiring a grant of probate

£0

£50,000 - £300,000

£250

£300,000 - £500,000

£750

£500,000 - £1m

£2,500

£1m - £1.6m

£4,000

£1.6m - £2m

£5,000

Above £2m

£6,000

The purpose of the probate fee increase

Lucy Frazer, Parliamentary Under-Secretary of State at the Ministry of Justice, sets out that "all income [will go] directly to our courts and tribunals – ensuring justice is done, and protecting victims and vulnerable people", with the admission that these fees will be subsidising over areas of the court system. The extra income is to be directed towards funding areas, such as domestic violence proceedings, where fees do not cover the costs to the courts.

Those estates that fall within the highest band will see the cost of applying for a Grant of Probate rise by over 38 times today's cost. It has long been the case that the probate process has generated a profit from fees. Whilst the Government has been keen to emphasize that the fees are not a tax, the fees may well be felt as a tax by those in the higher bands.

This change comes at a time when the Ministry of Justice are looking to modernise the system, as signified by their recent announcement that the traditional procedure of Swearing the Oath and marking the Will is to be replaced by, arguably a more simple approach, a Statement of Truth. Further guidance is awaited as to how this will work in practice.

Who will the probate fee increase affect?

The changes will affect all those except estates under £5,000 who currently pay no fee. Estates up to the value of £50,000 will now pay no fees - the change is thought to mean that 25,000 estates per year will not pay any fees at all.

As demonstrated by the table above, those estates over £50,000 will pay at least £250, increasing to a maximum of £6,000 depending on value.

Although such fees are ultimately recoverable as an expense of the estate, the fee is required up front and so there may need to be an element of planning to ensure it can be paid by executors.

If you would like to discuss any aspect of this article further, please contact Kimberley Woodhead or any other member of the Private Client team on 0113 244 6100.

You can also keep up to date by following Wrigleys on Twitter here.

The information in this article is necessarily of a general nature. Specific advice should be sought for specific situations. If you have any queries or need any legal advice please feel free to contact Wrigleys Solicitors

Kimberley  Woodhead View Biography

Kimberley Woodhead

Solicitor
Leeds

Ann Duchart View Biography

Ann Duchart

Partner
Leeds

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