Most probate fees are set to rise substantially from May this year despite overwhelming opposition to the Government’s plan.
Subject to parliamentary approval, a new band of charges will be introduced meaning that the more an estate is worth, the bigger the probate fee beneficiaries will have to pay.
This replaces the current flat rate paid by executors of wills and estates in England and Wales of £215 or £155 if applying through a solicitor.
Although there will be no fee for estates worth less than £50,000 – a change that has been broadly welcomed – estates valued at over £2 million will incur a charge of more than £20,000 representing a staggering 12,900 per cent increase.
The Ministry of Justice has pushed ahead with the proposals, despite widespread disapproval from lawyers and the fact that, during the consultation process, 80 per cent of respondents disagreed with the plan to link the fee to the value of the estate and 97 per cent disagreed with the level of the fees.
Seen by many as a form of taxation as the fees are based on the value of the estate before Inheritance Tax is deducted, there are concerns about how executors will find the money to pay the increase, especially without being able to access funds until after probate is granted.
In addition, many lawyers fear some people could be so put off by the increased costs they try to avoid the probate process altogether. They are worried that some might fail to report the estate to HM Revenue and others, particularly the elderly, might feel compelled to transfer assets before they die.
Claire Davis from Solicitors for the Elderly (SFE) adds: “The increase in probate fees will place a burden on families at a sensitive and distressing time and is likely to put people who are vulnerable and/or elderly at risk. Our fear is that such clients might be persuaded to take steps to avoid probate fees, even if the effect is to leave them with insufficient assets to provide for themselves for the rest of their life.”
What are the new rates?