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INCREASE IN PROBATE COURT FEES: How will this affect you?



Tue 27 November 2018 INCREASE IN PROBATE COURT FEES: How will this affect you? TRISTY POWELL
TRISTY POWELL >

Private Client Manager

On 5th November 2018, the Government announced an increase in Probate fees payable to the Probate Registry from April 2019.


The announcement comes after there was an attempt made last year to increase the fees, which would have seen some estates pay up to £20,000.

Although the new fees are lower than those proposed in 2017 they still represent a considerable increase on the current fees of £215 for individuals and £155 for those applying through a solicitor. Estates valued at under £5,000 are exempt from paying a fee under the current system.

The new fee structure will be based on the value of the estate as follows: 

 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


Many people have argued that the work undertaken by the Probate Registry to process an application is no different whether the estate is worth £50,000 or £5,000,000. It remains extremely unclear how the executors will pay the probate fees and there remains a lot of unanswered questions around how the money will be recovered from the estate.

The Ministry of Justice have as good admitted that the fee increases are to subsidise the Court service as a whole. In this way bereaved families will effectively be subsidising the Civil and Criminal Court. Given that the proposed increase was not announced in the Budget has led to accusations that the government is trying to bring this in by the back door and that the new fees are nothing more than a stealth tax on the bereaved.

What does this mean for the public?

If you are already administering the estate of a deceased person and have yet to apply for your grant, apply before the rules change. It is best to take legal advice as rushing to beat the probate court fees may lead to mistakes completing Inheritance Tax returns which, as a result, could lead to HMRC penalties for inaccuracies far greater than the application fee being avoided.

The fee is based on the value of assets owned by the deceased at the date of death. Assets gifted in lifetime, therefore, will be unaffected. The grant will not take into account assets passing by survivorship (assets in joint ownership – not to be confused with assets owned by multiple persons as tenants in common). Care needs to be taken before giving away or sharing assets, and professional advice should be taken.

Taylor Rose TTKW offer a full range of wealth and inheritance planning as well as probate related services, helping you and your family plan for the future. We are experts in this area, so call us on 01733 333333 to see how you might benefit from our experience.


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