Previously-shelved plans to increase probate fees have been ‘resurrected’ by the Government this week, but will have a slightly lesser impact on wealthy estates than was previously expected, it has emerged.
Under existing rules, obtaining a grant of representation – more commonly known as a ‘grant of probate’ – costs £215 for individuals or £155 if the person is applying through a solicitor. Any estates valued at £5,000 are exempt.
However, in a Government announcement made by Justice Secretary Lucy Frazer earlier this week, it was confirmed that a new “banded structure” of probate fees would be introduced in the near future.
The news follows similar proposals mooted last year, which would have introduced a sliding scale based on the overall value of each estate, as was once previously the case before the existing flat rate system was phased in.
Under the 2017 plans, the wealthiest estates would have attracted a maximum fee of £20,000 – but these plans were shelved towards the end of last year.
Resurrecting the plans in recent days, Ms Frazer said that the Government had “listened closely to concerns around early proposals.”
In light of this, she said that the new system – which will introduce a maximum fee of £6,000 payable on estates worth £2 million or more – would see that fees will “never be more than 0.5 per cent of the estate’s value.”
She added that they would also be “recoverable from the estate” itself.
“Fees will be set at a level to ensure that they will only be paid by those who can afford them, with all income going directly to our courts and tribunals – ensuring justice is done, and protecting victims and vulnerable people,” she said.
Ms Frazer added that the new fees would raise approximately £145 million a year from 2019/20, rising to £185 million a year by 2022/23.
However, Lakshmi Turner, Chief Executive of Solicitors for the Elderly (SFE), described the changes as a “stealth tax” on wealthy estates and said that the new system was “unjustifiable,” particularly following the recent U-turn.
She said: “It’s extremely unclear how the executors will pay the probate fees and there remains a lot of unanswered questions around how the money will recovered from the estate, as assets are frozen until the executors receive the grant of probate.”
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