Sarah Nash, Solicitor and Head of Astle Paterson’s Wills and Probate Department, discusses the latest changes to probate fees.
Sarah said “Within the last week, the Government has announced its intention to press ahead with proposed reforms to probate fees.
A consultation document was published by the Government in February last year in which it invited views from the public, law firms, professional bodies and the judiciary.
The current system of charging for a probate application which is submitted by a lawyer provides for a flat fee of £155, irrespective of the value of the estate, with no fee for estates under the value of £5,000.
The Government believes that its proposed changes will mean that the system for applying for a grant of probate will be more “just, proportionate and accessible”.
In summary, the changes are:
In practice, this will mean that an estate valued at between £50,000 to £300,000 will pay a fee of £300 – an increase of £145 – with estates valued at between £300,000 and £500,000 needing to pay £1,000 – an increase of £845. For larger estates exceeding £500,000, the fees will range from £4,000 to £20,000.
Personal Representatives of estates are normally only permitted access to the deceased’s funds in bank or building society accounts before a grant has been obtained to pay the funeral expenses and Inheritance Tax.
Under normal circumstances, the fee of £155 could be easily funded by Personal Representatives from either cash otherwise received by them (i.e. refunds or cash realised from the sale of personal chattels) or by means of a loan from themselves which is then refunded by the estate once probate has been obtained.”
Sarah continued “Whilst the increase of the threshold to £50,000 for the payment of a fee is welcome, the changes will clearly have more significant implications for larger estates with Personal Representatives needing to find ways to fund the increased fees. Unfortunately, the bank and building society representative bodies have been unable to guarantee that Personal Representatives will be able to access the deceased’s accounts to enable them to fund probate fees prior to the issue of a grant.
The other possible implication is that more people may be tempted to place money into a trust or into joint names with a family member during their lifetime in order to mitigate the impact of the new fees and provide easy access to funds, but doing so also has legal and tax implications, which should be carefully considered before proceeding.”
Should you like to meet with one of our specialist Wills and Probate Lawyers, please telephone the Department’s direct telephone line on 01283 743969.
