Increase in Probate Fees: The Banded System is Back
The Government have posted a “Written Statement to Parliament” on their website, announcing a change to the Probate Fee System from a simple fee of £155 (with solicitors), or £215 (without solicitors), to a banded system. This system was proposed last year, and a petition opposing it amassed 38,425 signatures, before being closed due to the upcoming general election. It seems this change has now been approved.
How are the Probate Fees going to be calculated?
The new changes will be based on the value of the estate of the person who has died. The changes will allow all estates falling below £50,000 to obtain a Grant of Probate with no charge; this is a huge increase on the current £5,000 threshold. The Government estimates that 25,000 estates would benefit from this annually, and it is easy to see how the thousands of people who have participated in Equity Release Schemes could benefit from this change.
However, the Government have estimated that more than 80% of estates will pay £750 or less; this is an increase of nearly 350% on the current fee when not using a solicitor, and a huge 500% increase when using a solicitor. The extra funds that will be made on this change will be spent upgrading the Court System.
How will individuals pay the Probate Fees?
If there is enough money in the bank account of the deceased, banks are able to release this payment via a cheque made payable to HMCTS (the body payable when applying for a Grant of Probate). In this case, the executors will not have to worry about paying the Court Fee upfront.
If there is not enough money in the bank account, the executors will have to make the payment themselves, and reclaim their money from the estate once there are liquid assets (e.g. cash) available for distribution. If the executors do not have the money to hand, they will be able to obtain a bridging loan from the bank to fund the payment during the “gap” between Probate and Distribution.
Of course, there is always the question as to whether payment of Probate Court Fees will be offered in the future in the form of an insurance policy, or perhaps through funeral plans.
How can Lawson-West Solicitors help?
It is always advisable to seek legal advice from a solicitor on what to do when someone dies, even if it seems that everything is relatively straight forward. Lawson-West offers a free initial consultation for executors, which provides individuals with a good “head-start”. We can provide you with an idea of the volume of work involved, and the process that will need to be followed for Probate. We will also be able to tell you about possible complications that may arise depending on the circumstances.
If you wish to speak to one of our specialists in the Wills and Probate Team, please call us on 0116 212 1000 or email us here.View all