🔔 Probate fee price hike postponed

The controversial plan to introduce increased Probate fees, which were due to apply from this week, has once again been delayed.

Last year, we brought you news that Probate fees were due to change from 1 April 2019, from the current flat rate structure to one based on the value of the estate.

On average, a total of 220,000 probate applications are processed each year at a current cost of £155 - £215 per application - depending on whether a professional is engaged in the process¹. 

With Parliament focused on other areas, this process has not been completed and whilst the changes to probate fees are still being considered, there is a temporary process in place for applying for probate.

Ordinarily, to obtain probate the person dealing with the estate must first submit an Inheritance Tax account to HMRC, as Probate registries normally won’t accept an application for probate until HMRC has confirmed that it has processed the Inheritance Tax account.

However, while the process for introducing the new fee structure is ongoing, probate registries will accept applications for probate before the account has been processed by HMRC. The application must include a note to say that the appropriate Inheritance Tax forms will follow shortly.

While applying for probate is often the last thing on the mind of the bereaved family, there could be a significant cost saving to be had for those who can take advantage of this delay.

The proposed new fees are as follows;

• Estates valued from £50,000 up to £300,000 will pay £250.
• Estates valued from £300,000 up to £500,000 will pay £750.
• Estates valued from £500,000 up to £1 million will pay £2,500.
• Estates valued from £1 million up to £1.6 million will pay £4,000.
• Estates valued from £1.6 million up to £2 million will pay £5,000.
• Estates worth more than £2 million will pay £6,000, a rise of £5,785.

On the flip side, as the new structure would see the abolition of a Probate fee for estates worth between £5,000 and £50,000, for some it could be prudent to wait. Estates valued at less than £5,000 will also continue to pay no Probate fees under the new scheme.

The need to take expert advice on inheritance and estate planning to reduce the tax burden for your beneficiaries has never been greater.

If you would like more information on the steps that you can take, please contact us on 0800 321 3581 or download our guide on Inheritance Tax, Wealth Management and succession planning ‘Securing your wealth for future generations’.

¹ source https://www.gov.uk/performance\moj-probate-applications

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