The Financial Times reported recently that Government proposals unveiled earlier in March; could result in a hundredfold increase in probate fees for some families. This came to light when the Ministry of Justice (MoJ) published its plans to reduce the £1.1bn annual cost of running the court system, by introducing a revised probate fees structure in England and Wales.
Under the current system, the ‘Grant of Probate’ – the document required to enable Executors to administer and distribute an estate – costs £155 for estates where assets are worth over £5,000. The proposed changes mean that the cost of obtaining the Grant will be directly linked to the value of the estate.
Although the MoJ is proposing to raise the payment threshold from £5,000 to £50,000, with estates under this value not having to pay any probate fees, they are intending to impose significant fee increases on estates worth more than £50,000, for example:
• An estate worth up to £300,000 will see the probate fee almost double to £300
• For estates worth £300,000 – £500,000 the fee is due to increase by over 600% to £1,000
• And families with estates worth over £2m will have to find £20,000 to cover the cost of obtaining the Grant of Probate, to enable them to distribute the estates assets.
The Government hopes to raise £250m a year through the revised pricing structure, and claims the “proposals would lift 30,000 estates out of paying the probate fee altogether”. However, with increasing property prices pushing up the value of many estates – particularly in the South East – more ‘ordinary’ families will now face significantly higher charges than before.
Though the Government’s proposals are still ‘under consultation’, it is a good idea to start reviewing your own estate planning provisions now – to ensure they are ‘fit for purpose’. Heir Tight Wills & Estate Planning Ltd are specialists in helping people with complex circumstances put in place robust provisions; including up to date, carefully considered, professionally drafted Wills, and Lasting Powers of Attorney in case of a loss of mental capacity.
For your complementary review, contact Rachael Rodgers