New Probate Fees
The Ministry of Justice (MOJ) have reviewed the fees charged by the Probate Registry and have released details of their new fees which take effect as from May 2017, the exact date of implementation is currently unknown.
Why is an application to the probate court required? If someone dies, with a Will, leaving assets to include a property, savings, investments or shares then a Grant of Probate is usually required. If the person dies leaving no Will then Letters of Administration must be applied for by the deceased’s nearest relatives in order for their estate to be administered. In order to be issued with either the Grant of Probate or the Letters of Administration (‘the Grant’) then an application must be made to the Probate Registry – it is this application fee which is due to increase significantly.
What are the current fees (prior to May 2017)? Currently the fees payable are £215 for personal applications and £155 for applications made by a Solicitors firm, for any estate irrespective of the value or the nature of the assets.
What are the new fees? The new scheme replaces set fees, with a tiered system where a fee is payable, based on the value of the deceased’s estate which passes under the Grant. The figures are as follows:
What does this mean for me? The implications of this change will vary from person to person, but could have substantial implications as to the costs involved in administering your estate after you die, which it may be possible to minimise through careful planning during your lifetime. In the same way that inheritance tax may be able to be minimised, it is worth seeking an up to date review of your Will and estate to see what these changes mean for you, your family and your estate and if steps can be taken.
Jointly owned assets When you die, some of your assets could be owned jointly with someone else and held as joint tenants. If held in this way, then those particular assets pass automatically to the survivor rather than passing under the Grant. This means that they would not be included within the net value of your estate for Probate purposes and so would not be subject to the fees above. It may also mean that a Grant is not needed.
However, if your property is held as tenants in common, either because it passes in accordance with a Will, or Declaration of Trust, then a Grant would usually be required. Property can also be held as tenants in common because you own unequal shares in it or this was the way you decided to own it when it was purchased.
Should I think about transferring my property during my lifetime? We anticipate there will be media coverage recommending people make lifetime transfers of their property, either to a family member or into trust, so as to avoid paying these fees. Such schemes on the face of it may seem to answer all the issues. However, transferring your property, often your main asset, to someone else, is not recommended unless you have taken legal advice – it can leave many people vulnerable and sometimes even homeless due to situations outside of their control. There can also be adverse tax and costs implications. We strongly recommend you seek legal advice before taking any action.
What can I do? Contact our Wills and Trusts Team. We will be able to offer helpful, practical advice and explain how this change could affect your estate when you die. Please call 01752 663295 to make an appointment.