Increase to the probate threshold and what this means

From 24 September 2025, a long-awaited update to the probate threshold will be introduced, increasing the threshold from $15,000 to $40,000. This update represents the first change since 2009, when KiwiSaver hadn’t been introduced and average estate values were much lower.

Under the current law, if someone dies and the value of their assets exceeds $15,000, a grant of probate or letters of administration must be obtained from the High Court before those assets can be released. The increase to the higher threshold means that for estates with assets valued under $40,000, assets can be released without going through the High Court. This will allow faster access to funds for more modest estates and will reduce legal and administrative costs that can deplete the funds left for the deceased’s family.

An application to the High Court will still be needed for those estates holding property or assets such as life insurance, KiwiSaver and bank accounts that exceed $40,000.

While the updated threshold is a welcome update for modest estates, it does not remove the need for New Zealanders to have a valid will. If the deceased has no will, their estate will be divided according to the strict rules of intestacy and those rules can lead to outcomes that do not reflect a person’s wishes. In simplified terms, the current intestacy rules are as follows:

• If you die leaving a partner and children, your partner will inherit all your personal belongings, a lump sum of $155,000 and one-third of the remainder of your estate, with the remaining two-thirds shared equally among your children.
• If you die with a partner but no children, and your parents are still alive, your partner will inherit the same lump sum of $155,000, all personal items and two-thirds of the remainder of your estate with the final third going to your parents.
• If you die with children and no partner, your estate is divided between your children equally.
• Without a partner or children, your estate will pass to your nearest blood relatives based on a prescribed list of relatives. If no relatives can be found it will go to the Crown.

Dying without a will also means you lose control over who administers your estate and who would care for your minor children as, again, the law sets out an order of priority of family members who have the right to be appointed in this position. It can also make the process of administering your estate slower, more expensive and more stressful for your loved ones.

A will remains the only way to ensure your wishes are followed and your family isprotected.

For assistance with making a will, please contact Morris. 

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