We’ve covered this article previously here on the Redwood Blog. However, we really think too many people are unaware of changes taking place in April this year that will see Probate Fees increase from a flat £215, or £155 if the estate is settled by a solicitor, to a six-band Probate Fee structure that will see some families paying up to £6,000! Maybe they see all the distractions of Brexit as a great opportunity to bury bad news!
The Probate Fee enables an executor to distribute a deceased person’s finances and property. The fee structure is now based on the value of an estate and fee structures include:
- Estate Valued between £1 – £50,000 or exempt from requiring a Grant of Probate Fee = £0
- Estate Valued between £50,001 to £300,000 fee = £250
- Estate Valued between £300,001 to £500,000 fee = £750
- Estate valued between £500,001 to £1m fee = £2,500
- Estate Valued between £1m to £1.6m fee = £4,000
- Estate Valued between £1.6m to £2m fee £5,000
- Estate Valued above £2m capped at £6,000
At the maximum fee, that’s a staggering 3,770 per cent increase on the current cost! The increases in charges are in no way reflective of the additional workload undertaken by the Probate Registry to process an application. A £50,000 estate is no different to process than a £5m estate.
The Government forecast that 25,000 Estates will be lifted out of the fee system all together through this change. However, more than 80% of Estates are expected to now be paying £750 or less. That’s still a 483% increase in Fees!
There is no way to avoid paying these fees. However, there are things that can be done to reduce your Estate for Inheritance Tax purposes and therefore reduce the size of the Estate for the calculation of Probate Fees. Strategies that involve the implementation of Trust arrangements and Gifting from the Estate would all be things to consider.
Redwood Financial is one of the Souths’ leading Pensions, Wills, Trusts & Estate Planning providers and we are dedicated to helping families to grow, protect and enjoy their wealth. With our unrivalled knowledge of pension and financial wealth planning, we can advise on any situation. Join us at one of our Free Public Information Seminars: Book online Book Me A Place!, Call us on 01489877 547 or Email firstname.lastname@example.org to book a FREE Initial Meeting with us to review your financial planning needs.