A Grant of Probate (or Letters of Administration if there is no Will) is the legal document giving the Executors (or Administrators) authority to deal with the assets and liabilities of an estate in accordance with the Will or under the Rules of Intestacy.
What that does NOT mean is that the Executor/ Administrator can do what they wish with the estate. If they don’t follow the Law then they may be sued or even prosecuted for theft
Probate Fees to obtain a Grant of Probate
or Letters of Administration. There are three sets of costs, the Probate Registry Court Fees, probate solicitors fees, and expenses of the administration. Let us deal with these in turn.
1) Probate Fees as charged by the Registry for the Grant of Probate.
As at May 2019, things are pretty chaotic (see the home page for updates) as there is a mad rush to apply for a Grant of Probate or Letters of Administration before the fees rise at some unspecified date in the summer. There will only be 21 days notice of the implementation, so some folk are scrambling to save as much as £5,715.
Current fees for estates valued at over £5,000 are £215 + 50p per copy of the Grant of Probate/ Letters of Administration. Solicitors are charged £60 less.
Probate Fees to be introduced summer 2019 are vastly different and are designed as a tax on Middle England as far as we can see. Here they are:
|Size of estate (before inheritance tax.)||Proposed fees.|
|Up to £50,000||£0|
|£50,001 – £300,000||£250|
|£300,001 – £500,000||£750|
|£500,001 – £1,000,000||£2,500|
|£1,000,001 – £1,600,000||£4,000|
|£1,600,001 – £2,000,000||£5,000|
As you will see, some families will have to find substantial sums even to submit the application for the grant. To make matters worse, Inheritance Tax has to be paid before the grant can be considered (IHT on property can be staggered). With funerals currently the biggest item on credit cards, they could be topped by fees for probate grants soon, giving a further blow to the bereaved.
2) Probate Costs – Expenses of the Administration.
Whoever is the Executor or Administrator of the estate, there will be costs involved in managing the process. Expenses that Executors or Administrators can claim personally are very limited. No chance of making a profit!
However, it may be necessary to pay out for property insurance (you could get sued if you don’t and something goes wrong), urgent repairs and maintenance. Other insurance is available to protect executors. Bankruptcy searches on all beneficiaries, Trustee Act Adverts, tracing services, loans to pay Inheritance Tax, probate fees. Professional fees (we can source small amounts of help or a complete service at sensible fees should you wish it. There is also the cost of the funeral to be considered where there was no prepaid plan in place. See here to sort your own!
3a) Do I need Professional Help?
Whilst we ourselves only give very general guidance, we have a range of trusted and experienced associates who can deal with everything from a few minutes help to sophisticated tax planning and trusts.
There are a few occasions when we would strongly recommend asking us to get the right professional help. Remember that once you do anything, you are stuck with seeing the job through, though you can usually delegate to lawyers and recover the costs from the estate.
- Where you don’t have the administrative skills or perhaps the time.
- Where there is any possibility of a dispute (unless professionally handled, these soon permanently scar family relationships)
- Where a life partner or family member is not provided for.
- Overseas assets.
- Inheritance Tax liabilities
- Executors are overseas or miles away from the deceased’s home. It is possible for non-recoverable travel costs to exceed the cost of legal fees.
- Trusts within or outside the Will or intestacy (no Will).
- Potentially insolvent estates.
- Original Will lost.
Remember, you don’t necessarily have to hand everything over, we can help you just to get advice in specific areas.
3b) Professional Fees
Lawyers fees vary wildly – as you have probably gathered, our job is to point people in the right direction to firms who can offer the necessary level of support. That may be 15 minutes advice or taking over a multinational estate with all its complexities or anything in between.
Bereaved family members are often in no state to deal with complex forms and administration. But we can offer a halfway house through our associates to check things through with you.
Professional fees vary from a flat 1 to 4% of the gross estate, to hourly rates, typically over £250 an hour – all plus VAT. Some add a sucker punch of an extra commission, on top of the cost of the hourly rate of anything up to 1.8% of the gross value of the estate as a “responsibility allowance” – which can triple the bill. We will not recommend anyone who does that.
Our associates can help with straightforward estates from as little as £95 an hour (May 2019) and for more complex estates we would introduce you to others who can provide more sophisticated help at the low end of solicitors fees – with no nasty responsibility allowance! Alternatively, a flat fee of 1.25% of the gross estate. All plus third-party costs (disbursements) and VAT where relevant.