If a person dies leaving a Will and assets of more than £20,000* then the Executors appointed in the Will are usually required to apply for a Grant of Probate to administer the estate. If the deceased left no will then a Grant of Letters of Administration is required.
Two years ago, I wrote an article (featured in The Haslemere Guide) discussing the Government’s wish to increase Probate fees from £215 per application to a sliding scale of fees (depending on the size of the estate), at the top end of which the fee was set to increase to £20,000. Although the new fees were due to come into force in May 2017 the Ministry of Justice announced that it had abandoned the reforms due to lack of time during Parliament following the Prime Minister’s snap election call. At the time it was perhaps unsurprising that in some quarters the fee was being called a ‘tax’ and the proposals attracted overwhelming opposition.
The new fees were said to be earmarked to raise around £250 million per annum for the Treasury and would ‘reduce the burden on the taxpayer of running Courts and Tribunals’. What was unclear at the time was whether the proposals which were so deeply unpopular would be revived after the General Election.
I commented that ‘in view of the revenue the fees could generate, the new fee structure should not be ruled out in the future.’
History repeating itself
Sadly, the fees are back (with some tweaking) and were due to come into force in April 2019**. At a time when everyone had other things on their minds – Brexit – the Government quietly announced the new fee structure. The enormous fees which were quite unjustifiable have gone, but with a fee of £750 for an estate valued between £300,001 and £500,000, and a fee of £2500 for an estate valued between £500,001 and £1m, a large number of homeowners in this area will be adversely affected. At the top of the sliding scale the new fee will still be a staggering £6,000.
This change in fees has again highlighted the need for your Will to be reviewed at regular intervals to ensure you have taken the most uptodate advice available and your assets are administered as efficiently as possible. Perhaps you own your property jointly with your spouse or civil partner as tenants in common. It could be that this is no longer required due to other changes in the Law but you have never updated your old will or the registered Title at the Land Registry. If this is the case, then your estate could be subject to unnecessary Probate fees.
*after April 2019 £50,000
** The statutory instrument (SI) bringing the revised probate fee scheme into force has not yet been laid. A Ministry of Justice spokesperson said the reforms will come into force ‘as soon as possible’ but that Brexit matters were taking precedence.
If you would like any advice about wills, fees, Inheritance Tax or Probate then please contact Christine Hanson on 01428 722189.