Changes to the flat fee structure in estate administration

Probate fees are set to increase subject to a Parliamentary Committee vote later this month. These fees are the cost associated with administering someone’s estate after they have passed away.

The role of a Personal Representative (PR) is to administer the estate of someone who has died, and although a PR derives their authority to act from the deceased’s Will, it is the Grant which confirms the authority and is proof of title to the deceased’s assets. A PR usually needs to obtain a Grant and without this is unable to complete the administration, calling in the assets, settling liabilities and finalising distribution.

To apply for a Grant an application is verified by a statement of truth, replacing the previous requirement to swear or affirm an Oath. It is then submitted with the completed IHT forms identifying the extent and value of the deceased’s estate. The forms must also be accompanied by the Probate Court fee application, which currently has been at a flat fixed fee of either £155 if the application is made by a Solicitor or £215 for a personal application.

That fee was set as a fee sufficient to cover the Court costs for the administration process. The Non-Contentious Probate fees Order 2018 (draft) now proposes to introduce a new banded fee structure to replace the current flat fee arrangement and on 7 February 2019 a delegated legislation committee at the House of Commons voted in favour of progressing the draft Order to the Commons for approval.

The date for the House of Commons final vote has yet to be announced, but is generally expected to be approved and for the new fees to come into effect from April 2019.

The new proposed fee structure for an Grant/resealing application charges from £250 where an estate exceeds £50,000 but not £300,000, all the way up to a fee of £6,000 where an estate exceeds £2,000,000. 

It could be argued that the departure from the flat fee rate does more than cover the cost of administering the Court costs for the issue of the Grant and is effectively a tax in stages on larger estate values, yet the same service, process and formalities are provided for each estate.

Any PRs currently coming close to completing their calculations in the values of the estate for IHT purposes, payments and submissions of forms for the Grant may be well advised to endeavour to make their applications sooner rather than later in anticipation of what maybe a substantial hike in Court fees.

MORE INFORMATION

​It is expected this new fee structure will be implemented in April 2019 and full details of the government proposals can be found at https://www.gov.uk/government/speeches/announcement-on-probate-fees

In view of this substantial increase, it would be advisable to act quickly in dealing with probate following the death of a loved one. If you need any help or guidance please contact our Private Client Team who can arrange a free initial probate consultation.This article was written by Kerry Hull, a Senior Associate at Pinney Talfourd LLP Solicitors. The contents of this article are for the purposes of general awareness only. They do not purport to constitute legal or professional advice. Specific legal advice should be taken on each individual matter. This article is based on the law as of February 2019.