Govt Raises Probate Threshold to $40K to Ease Burden on Bereaved Families

In a move aimed at reducing financial and emotional strain on grieving families, the New Zealand Government has approved an increase in the probate threshold from $15,000 to $40,000, Justice Minister Paul Goldsmith announced this week. The change, which will take effect on 24 September 2025, is designed to modernize estate administration laws and reflect changing financial realities—especially with the advent of KiwiSaver.

“The threshold was last updated in 2009, before the widespread introduction of KiwiSaver,” Goldsmith explained. “Most estates now include KiwiSaver balances that exceed $15,000, meaning many families have had to go through costly High Court processes even when dealing with modest estates.”

What Is Probate and Why the Threshold Matters?

Probate is the legal process through which the High Court confirms the validity of a deceased person’s will and authorizes an executor to manage and distribute the estate. If the estate’s value exceeds a set threshold, the executor must apply for probate before financial institutions can release funds.

Until now, this threshold stood at $15,000, meaning even modest estates, such as those consisting primarily of KiwiSaver balances, small bank accounts, or minor insurance policies, required court intervention. This often resulted in legal fees, delays, and administrative burdens that disproportionately affected families handling smaller estates.

The new $40,000 threshold allows executors to access and distribute assets below this amount without needing to go through the probate process, significantly simplifying estate administration for thousands of families each year.

Easing the Burden on Families

Goldsmith emphasized the human impact of the reform, noting that grieving families are too often forced into complex legal processes for relatively small estates.

“Executors need to be able to distribute lower-value assets efficiently so that more of the estate goes to the intended beneficiaries,” he said. “The last thing families need while mourning a loved one is additional paperwork, legal costs, and stress.”

This change is expected to reduce High Court workloads, speed up the transfer of funds, and preserve more of the estate’s value for those left behind.

Safeguards Remain in Place

While increasing the threshold offers practical relief, Goldsmith reassured the public that essential safeguards will still apply to larger estates and those with more complex legal concerns.

“I’m assured $40,000 is still low enough to ensure that there’s appropriate oversight by the High Court for higher-value estates. This continues to protect against fraud, dishonesty, or mismanagement and ensures the wishes of the deceased are properly respected.”

The new threshold strikes a balance between accessibility and accountability, helping families avoid unnecessary court processes without compromising legal protections.

Consultation with Legal and Financial Experts

The decision follows targeted consultation by the Ministry of Justice with key stakeholders, including members of the legal profession, public trustees, financial institutions, and estate planning experts. There was broad consensus that the $15,000 threshold was outdated and failed to reflect current financial realities, particularly in light of KiwiSaver and rising savings rates.

Many professionals had raised concerns that the low threshold disproportionately affected modest-income households and created bottlenecks in an already strained court system.

The new $40,000 threshold brings New Zealand’s probate laws closer to those in other developed countries, where higher limits are commonly used to distinguish between minor and complex estates.

Implementation and Next Steps

The increased probate threshold will come into effect on 24 September 2025. Executors, lawyers, and financial institutions will receive updated guidance and procedures to ensure a smooth transition.

The Ministry of Justice will also update public information resources to help families understand the new rules and determine whether their loved one’s estate requires probate.

A Win for Common-Sense Reform

This reform is part of the Government’s wider agenda to modernize legal processes, reduce bureaucratic burdens, and make public services more efficient and responsive.

“This is a common-sense change that will have a real impact on ordinary people during one of the most difficult times in their lives,” said Goldsmith.

By updating a threshold untouched for over 15 years, the Government is taking a practical step toward ensuring fairness, efficiency, and compassion in New Zealand’s probate system.