Increase in probate fees confirmed

In January 2022, the probate fees changed.  You can find out the relevant fees using our Probate and Estate Administration Costs page.

Controversial fees that were proposed and scrapped in a matter of weeks last year will now be introduced in April this year following parliamentary approval earlier this month.  Probate applications are expected to rise between now and then in order to avoid the increase in what is being dubbed a ‘stealth death tax’.  Kirsten Edberg, Associate Solicitor in our Private Client team, explains the rise due to be implemented and the steps you can take now when making plans for your estate.

Currently there is a flat fee for probate applications, set at £215 for a personal application or £155 when using a solicitor.  The new system will see a tiered rate of fees depending on the size of the estate.  “The initial concern that arose last year when this tiered system was proposed was that some estates would have seen an application fee of £20,000,” begins Kirsten.  “Due to this, and other objections, the proposals were scrapped and a new sliding scale has now been approved.”

What will the probate fees be?

The new proposed probate fees will be as follows:

• Estate valued up to £50,000 – exempt from probate fees
• Estate valued between £50,000 - £300,000 - £250
• Estate valued between £300,001 - £500,000 - £750
• Estate valued between £500,001 - £1million - £2,500
• Estate valued between £1,000,001 - £1.6million - £4,000
• Estate valued between £1,600,001 - £2million - £5,000
• Estate valued as over £2million - £6,000

This probate fee is payable by Executors so that they can proceed with the administration of the estate following a person’s death.  “As this fee is payable before finances of the deceased can be accessed, some bereaved families may be required to take out a loan to make this initial payment,” explains Kirsten.  “It is only Inheritance Tax and costs for a funeral that can be taken out of the estate funds prior to approval of the probate application; until this time banks will not release funds and no property can be sold, which will cause additional concerns where an estate is cash poor but has high property value.”

There is still criticism from the House of Lords Secondary Legislation Scrutiny Committee and the Joint Committee on Statutory Instruments (JCSI) that the increase does not reflect the service a person will receive as the process is purely administrative and does not vary depending on the size of the estate.  The main justification from the government in introducing the new fee structure is that it would create an extra £145million to help cover the costs of running the court system.

How can estate planning help with the increase in probate fees?

For Executors currently administering an estate, it is recommended that you seek legal advice to review your position as to whether you can apply for probate in the next couple of months. 

Kirsten concludes, “If you are concerned that the value of your estate could leave your loved ones with a large fee to pay, we would recommend you come to us to discuss your options in terms of estate planning.  It may be that a Trust, for example a Life Interest Trust, could assist in ring-fencing part of your estate for your beneficiaries in the future.  It is important you understand all of your options when making plans of this nature and receiving the right advice will leave you aware of all the facts taking your own particular estate, assets and family situation into consideration.”

For more details on estate planning, you can contact Kirsten or the Private Client team on 01329 222075 or email privateclientenquiry@warnergoodman.co.uk.  If you have questions on probate administration following the death of a loved one contact us to book your free 30 minute appointment as to the next steps.

ENDS

This is for information purposes only and is no substitute for, and should not be interpreted as, legal advice.  All content was correct at the time of publishing and we cannot be held responsible for any changes that may invalidate this article.