By David Porter, Armstrong Watson

DEALING with the estate of someone who has died can be stressful, but it was generally not costly. Eighteen months ago, however, the government mooted the idea of increasing the fees in England and Wales - quite substantially.

Inevitably, this was met with headlines such as ‘stealth tax on the dead’, and so with the surprise general election, the Government decided to shelve the increase. Unfortunately, this was not to be permanent, and in the past couple of months, they have confirmed an increase in Probate fees from April.

Under existing rules, when someone dies a fee is charged for the grant of probate of £215. If using a solicitor, the fee charged is £155. From April, the fees will increase – but not by as much as previously thought. The original suggestion would have seen the largest estates: over £2 million, facing a fee of £20,000. However, under the revised proposals, these estates will now pay £6,000, and whilst this is still a substantial increase over the current levels, it is not as bad as first expected. Families will need to be able to call upon this level of funds so that they can make the application and gain access to the deceased’s estate.

It’s not all bad news, though, as the value of the estate below which no fee is payable will rise from £5,000 to £50,000. This will lift a great number of estates out of paying any fee at all, reportedly 2,500.

Unless you’re planning to die before the new fees come into place – which is unlikely to be anyone’s favoured option – there is little that can be done. Perhaps more people should consider gifting the larger probate to their children during their life, with the intention that this amount should be held for the future, if there is a concern that the amount will be an issue?

With a greater number of estates now suffering IHT, and the tax take exceed £5 billion for the first time (an increase of 8% over the previous year), it is clear that families are not planning ahead sufficiently to pass assets down to the next generations. This does not always mean using complex structures to reduce the IHT burden on your family – there are a number of exemptions and investments that can be used to reduce the burden. As always, the most important thing is to start planning as early as possible.

To learn more about Inheritance Tax and the implications for your estate, please contact David Porter, Financial Planning Consultant on 01756 620000 or email