A legal loophole may stop or delay a proposed increase in probate fees that could see some families having to incur thousands of pounds in charges.
The Ministry of Justice wants to implement a tiered system that would see the current £215 fee (£155 through a solicitor) replaced with charges of up to £20,000.
But the Government’s Joint Select Committee for Statutory Instruments, which was examining the proposals, says the new charges would, in reality, be a tax.
Andrew Vernon, a Partner in our Wills, Trusts and Estate Planning team, looks at what this means:
Lawyers have been concerned from the outset that this was just a tax by any other name and would penalise the most vulnerable members of society.
So it’s good news that the Ministry of Justice plans have been halted in their tracks – at least for the time being, anyway.
The Committee says the new charges are, in effect, a tax as people who are administering an estate have to incur them - there is no choice when it comes to probate, unlike if you choose to take some other form of legal action. It says the Lord Chancellor doesn’t have the power to introduce this so it seems that the Ministry of Justice will have to go back to the drawing board.
The increasing value of the estate has no bearing on the work undertaken and there is no more work required by the Registry where the estate is of a higher value. I am not sure how the Ministry of Justice was justifying the increase but I suspect it will something they will try and implement one way or another.
Any rise in probate fees will place a burden on families at a sensitive and distressing time and is likely to put people who are vulnerable and or elderly at risk. While I suspect that this is merely a delay in an inevitable, I hope it prompts the Ministry of Justice to come up with a more equitable solution.
Ministry of Justice proposed increases:
Less than £50,000 – exempt
£50,000-£300,000 - £300
£300,000 to £500,000 - £1,000
£500,000 to £1m - £4,000
More than £1m - £8,000
More than £2m - £20,000
For further information, please contact our Wills, Trusts & Estate Planning team. Alternatively, read more about our Wills, Probate & Lifetime Planning services.