We wrote a while ago about the government’s proposals to increase probate fees and these new fees will apply from April 2019.
The fees will be paid on a sliding scale, starting at £250 for estates valued at between £50,000 and £300,000. Probate fees on estates valued at in excess of £2m will be set at £6,000.
Approximately 58% of estates in England and Wales are valued at £50,000 or less and these will be exempt from any probate fees. It is expected that each year, an extra 25,000 estates won’t pay any probate fees.
It’s not great news for the ‘squeezed middle’. Those set to inherit the family home worth the UK average of £300,000 will be expected to pay approximately £750 in government probate fees, many more times than the current level.
Says Julia Gallagher, tax partner licenced to carry out probate work at Curo Chartered Accountants “Government probate fees have increased significantly over the last couple of years and the increased fees are steep, representing bad news for many due to inherit what are considered ‘modest’ estates’. This charge is in addition to fees payable to the accountant or solicitor carrying out the probate work and makes an already upsetting situation even worse”.
The changes are due to take effect from April 2019 and individuals are being urged to consider their tax positions before then. There is still time to carry out various changes which will help to protect the value of the estate and provide for loved ones.
Adds Julia “We always welcome clarity around changes to taxation. As the probate fees are based on estate values at the time of death, it is worth speaking with a tax specialist to understand your inheritance tax options.”
Please contact [email protected] or call 01527 558539 to discuss your options and understand how to optimise your tax position. Please see more about our probate services here. More help can be found on the HMRC website.