Probate Issues

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A substantial increase in probate fees was planned for April 2019, but is still making its way through parliament, due to pressure of other business. The media has been quick to call this a new ‘death’ tax. Strictly speaking, however, this is an ‘enhanced fee’, rather than a tax. It would apply in England and Wales, not Scotland and Northern Ireland, which have their own procedures.

The change would replace the long-standing flat rate scheme, with its fixed fee of £155 for a solicitor’s application, or £215 for a personal application. The new rules would set fees depending on the size of the estate (before inheritance tax), with no discount for applications via a solicitor. Whilst estates worth less than £50,000 would be exempt, the change would have particular impact on higher value estates.

Value of estate before inheritance taxFee
Up to £50,000Nil
£50,000 to £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
Over £2 million£6,000

 

While the changes are pending, there is a temporary process in place for applying for probate, and estates will not incur the higher fees if applications are lodged before the fee changes take effect. Probate registries will thus, exceptionally, accept applications for probate before HMRC has processed the necessary inheritance tax account. Applications should contain a note to say that appropriate inheritance tax forms will be submitted ‘shortly’.

 

This publication has been prepared by RRL LLP. It is to be treated as a general guide only and is not intended to be a comprehensive statement of the law or represent specific advice. No liability is accepted for the opinions it contains, or for any errors or omissions. All rights reserved.