Death is to become a lot more expensive from April 2019 – Article about probate fees

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Death is to become a lot more expensive from April 2019 (article by Jakub Kotan)

 

The Government intends to raise probate application fees by hundreds and thousands of pounds. This is a resurrection of a plan abolished just before the last election in 2017.

The current fee for a Grant of Representation is £215 for a private individual or £155 if the application is done by a solicitor. Most estates require a grant issued by the Probate Registry so personal representatives can administer the deceased’s financial matters and distribute the residue under their will or the rules of intestacy.

If the new plan goes ahead the fees affecting some 85% of estates will change from April 2019 as follows:

Estate valueFee
Up to £50,000Exempt (previously £5,000)
£50,000 to £300,000£250
£300,000 to £500,000£750
£500,000 to £1m£2,500
£1m to £1.6m£4,000
£1.6m to £2m£5,000
Over £2m£6,000

For further information please see The Non-Contentious Probate (Fees) Order 2018

The Government claims that approximately 25,000 small estates (value up to £50,000) will benefit from the new rules. This is, however, where the benefits end. It is estimated that most applicants in England and Wales will pay £750. Having said this, one should be observant of the property prices in London and South East. As they are much higher than the rest of the country, they are likely to push probate fees in these locations into the thousands of pounds.

The Ministry of Justice claims that increasing the probate fees will raise approximately £150m per annum which is likely to be spent on running the courts and tribunals service. The Law Society voiced its concerns by stating that the Government is simply ’increasing inheritance tax by stealth’.

Garner & Hancock and other practitioners believe that due to these changes people may be inclined to make arrangements during their lifetime in order to escape high probate fees. Putting assets into trust or giving them away may become more attractive as a result.  While disposing of assets before you die to avoid these fees can seem a good idea it is important to take expert advice before doing so.  If you would like to discuss your options further please contact us.

We will keep you updated about the introduction of the new probate fees and other changes in this area of law. Please contact Nigel George or Jakub Kotan in our private client department.