Cost of Dying to Increase

tax implicationsThe government is to press ahead with plans to substantially increase the cost to bereaved families of settling the estates of deceased relatives. The plans will see some estates pay almost £6,000 more, but for estates worth less than £50,000, there will be no fees to pay at all.

In England and Wales, probate fees, paid when administering someone’s estate after they die, will now be on a sliding scale depending on how much the estate is worth, rather than as a flat fee.  At the moment, families pay a flat of £215, or £155 if they apply through a solicitor, on estates worth over £5,000.

According to the Ministry of Justice, the threshold at which you’ll need to pay probate fees is set to increase to £50,000 from April 2019, meaning an extra 25,000 estates per year won’t pay any fees at all.  But if the estate’s value is higher than this, you’ll see an increase in probate fees.  

Value of estate Current fee New fee No of estates
per year
Up to £5,000  £0 £0  241,000
£5,001 to £50,000  £155/£215  £0  23,000
£50,001 to £300,000  £155/£215  £250  126,000
£300,001 to £500,000  £155/£215  £750  59,000
£500,001 to £1m £155/£215 £2,500  30,000
Over £1m to £1.6m  £155/£215  £4,000  5,000
Over £1.6m to £2m  £155/£215  £5,000  1,500
Over £2m  £155/£215 £6,000  2,500

These changes will only apply to estates in England and Wales.  Scotland and Northern Ireland have different probate fees.

What does the Government say?

In a written statement to Parliament, the Parliamentary Under-Secretary for the Ministry of Justice Lucy Frazer MP said: “This new banded fee model represents a fair and more progressive way to pay for probate services compared to the current flat fee and reflects our commitment to protecting access to justice by ensuring we have a properly funded and resourced courts system.

“We are also confident these fees will never be unaffordable.  The cost of the fee is recoverable from the estate and executors have several options to fund it.  Moreover, the Lord Chancellor retains a power to remit a fee if he considers there are exceptional circumstances.”

Sources

www.saga.co.uk/magazine/money/personal-finance/inheritance/paul-lewis-changes-to-www.probate-fees-in-2019
www.bbc.co.uk/news/uk-politics-46113896
www.moneysavingexpert.com/news/2018/11/government-announces-probate-fees-hike/
Ministry of Justice November 2018 and Freedom of Information response August 2017.