An increase in probate application fees that comes into effect this month has been described by the president of the Law Society as an ‘additional inheritance tax’.
The fees payable will be graduated and based on the value of the estate. The fee for estates worth more than £50,000, currently £155 will increase to £300, while the maximum fee will increase to £20,000 for an estate worth £2 million.
Currently any amount left to charity is exempt from Inheritance Tax. Whilst this looks set to continue, these bequests could be reduced by the increased fees for obtaining probate. Some estimate that the changes could cost the charitable sector as much as £10 million a year.
According to the Society of Trust and Estate Practitioners, approximately 85 per cent of estates will be liable for higher fees.
The increase in fees has been criticised as the Probate Registry’s costs and the amount of work involved in providing a grant of probate are the same whether the value of the estate is £10,000 or more than £1 million.
It is important that individuals seek expert advice to ensure that their affairs can be arranged to not just minimise inheritance tax but to also minimise probate application fees. In addition, it is imperative that probate applications are completed accurately and in accordance with current legislation so that the correct probate registry fee is paid.
Author: Katy Burgin