The global association for familyinheritance and succession planning practitioners,STEP has reported that legislation introducing a steep increase in probate fees will be considered by the House of Commons Delegated Legislation Committee on 7 February 2019.
It is proposed that probate fees will increase from the current flat fees of £155 for solicitors and £215 for individuals, to a sliding scale of between £250 and £6,000, depending on the value of the estate.
The Committee will debate the legislation, following which it will go to the House of Commons for a vote.
The proposed changes have attracted criticism from professionals, charities, STEP and parliamentary members. The Ministry of Justice has confirmed that the increased fee income will be used to benefit the court service as a whole. It has been argued that the Ministry of Justice’s powers extend only to imposing fees that cover the cost of a service and that the proposals are therefore outside the Ministry of Justice’s powers. Many are of the view that this is, effectively, a new taxation measure rather than a fee.
The new fee scale could cause difficulties for executors dealing with valuable estates where the majority of the value is tied up in property. In such cases, executors could struggle to fund probate fees up-front. It may be necessary to try and secure loans, which could be expensive. The proposals are likely to disproportionately affect widows, widowers, and charities, as there are no spousal or charities exemptions, as there are with inheritance tax. This could have a significant impact on charities’ legacy income.
The plans are a watered-down version of a previous proposal made in 2016, which did not go ahead. The increases to probate fees are likely to take effect in April 2019.
For more information on the changes to probate fees and how this could affect you, please contact us using the enquiry form below.
[contact-form-7 id=”124040″ title=”Wills. Trusts and Probate contact us form”]