What is probate, and when is it required?
When someone dies, a Grant of Representation often needs to be obtained by the person entitled in the Will or by law, in order to provide the necessary legal authority to deal with the deceased’s assets and liabilities.
There are some circumstances where a Grant may not be required, for example where the assets are jointly held and pass automatically to the surviving owner, or worth less than £15,000 in total. However in most cases, a Grant will be required and an application for Probate must be made.
What are the fees?
There has previously been a flat fee of £215 (for personal applications) or £155 (for solicitor applications) for all estates regardless of the value. There are additional fees of 0.50p per sealed copy obtained, but it is unclear whether or not these fees will be retained.
A new banded system of fees based on the value of an estate was first suggested by the government in February 2017. There was significant opposition to these fees, which ranged from £0 for estates worth up to £50,000, to £20,000 for estates over £2 million. These changes were abandoned by the Ministry of Justice, as there was insufficient time to implement them before the 2017 General Election.
A revised banded system was announced in the November budget, and has now come into force with effect from 27th November 2018. These fees are lower than those set out in the 2017 proposal and are as follows:
- Estate value of up to £5,000 - new fee £0 - changed by 0% from previous regime
- Estate value between £5,000 - £50,000 - new fee £0 - changed by -100% from previous regime
- Estate value between £50,001 - £300,000- new fee £250 - changed by 16% from previous regime
- Estate value between £300,001 - £500,000- new fee £750 - changed by 249% from previous regime
- Estate value between £500,001 - £1 million- new fee £2,500 - changed by 1,063% from previous regime
- Estate value between £1 million - £1.6m- new fee £4,000 - changed by 1760% from previous regime
- Estate value between £1.6m - £2 million- new fee £5,000 - changed by 2,226% from previous regime
- Estate value over £2 million- new fee £6,000 - changed by 2,691% from previous regime
*The values of the estate are net but before inheritance tax has been deducted.
The changes have today been implemented by Statutory Instrument and with such speed that there has been very little opportunity to mitigate the impact on estates that have not yet obtained probate.
Nicknamed a “Stealth Tax” the increased fees continue to raise controversy amongst legal professionals and consumers alike. Despite this, Lucy Frazer, junior Justice Minister, has confirmed that all money raised from the increased fees will be used to fund the courts and tribunals service.
We still await the government’s official document of guidance on these fees (‘Guidance on Ways to Pay for Probate Fees’) and how they might be funded in estates with limited cash assets.
For further information, or assistance with your own probate application, please contact a member of the Private Client team:Natasha Southam