12 March 2019
Services:
Personal Tax Planning
The Government is set to go ahead with plans to increase the cost to bereaved families of settling the estates of deceased relatives. The probate fee, which allows an executor to distribute a person’s assets, is to be replaced with a six-band fee structure.
As of April 2019, instead of a flat fee, probate fees will now be charged according to how much an estate is worth within banded thresholds. The highest valued estates (those worth over £2m) will now be charged at a maximum of £6,000, which is an increase of 3,771%.
However, families with estates worth up to £50,000 will pay nothing - meaning 25,000 estates will be exempt from fees altogether each year.
Under the current structure, individuals pay a flat amount of £215 on estates over £5,000 (or £155 when grant application is made by a solicitor).
How much will it cost?
As of April 2019, probate fees will be set depending on the amount the estate is worth:
- Up to £50,000: Nothing (a saving of £215)
- £50,000 - £300,000: £250
- £300,000 - £500,000: £750
- £500,000 - £1 million: £2,500
- £1 million - £1.6 million: £4,000
- £1.6 million - £2 million: £5,000
- £2 million or more: £6,000
How does probate work?
After someone passes away, their estate (which includes their property, finances and other possessions) is gathered, sorted and distributed by the executor of their will. This person will need to apply for a ‘grant of probate’ before the estate can be finalised.
If there is no will, the deceased’s next of kin will need to get a ‘grant of representation’ (known as letters of administration) to prove their authority and administer the estate.
This process of applying to the court for a grant is generally referred to as probate.
How can Haines Watts help?
We understand it can be incredibly difficult and stressful to have to deal with probate on top of the emotional circumstances of a loved one passing away. We can be by your side to take care of the longwinded process, from collecting assets to organising debt payments, and being able to liaise directly with HMRC to save your time.
