It is troubling that it's possible that ministers may be giving some consideration to resurrect plans to increase probate fees by up to £20,000; despite these being quietly shelved due to the early General Election in May.
This comes despite the fact that there has been very little in the way of appetite either from lawyers or the general public with regards to the move. Many believe the move flies in the face of British aspirational values while also hitting the pockets of hardworking families and threatening both the financial and emotional legacies of older generations.
The Ministry of Justice has confirmed today (21/4/17) that the proposals for increasing the application fee for a Grant of Probate have been shelved.
Following the announcement of a snap election for June 8 2017, the lack of parliamentary time left to deal with outstanding matters before dissolving in early May means the introduction of the controversial fees will be halted.
The Ministry of Justice recently provoked consternation with news that it would introduce a massive hike in probate fees for those estates valued over £50,000. Currently the fee is £155 (if grant of probate is obtained through a solicitor) or £210 (if an individual applies).
However, with the increase in place, fees will range from £300 to a whopping £20,000, with the higher sum applicable for estates valued at £2 million or over and, depressingly, the Government Response to the consultation on fee reform makes clear what the real reason is for the proposed increases: "a properly funded courts and tribunals service".
However you want to characterise it, if we are indeed in the post-truth age or the era of "alternative facts" it is likely that it would be, by definition, so confusing a state of affairs that we would be unable to tell. But the sheer brazenness of the government‘s budget announcing a May 1st hike in Grant of Probate "court fee" does feel indicative of a huge disconnect between policy and reality, and as such is couched in suitably misleading language. But make no mistake it is a tax on death that strikes right to the heart of families, their sense of security, their sense of self-worth and their self-reliance. We should not be surprised if ultimately it undermines families, their connection to their land and their legacies.
Currently the probate process is, basically, fair. Probate solicitors have to pay a flat rate of £155 when making probate applications, while personal representatives who manage the process themselves pay a slightly higher £205. But with the new banding fees to be calculated before inheritance tax settlement, estates will soon face bills of thousands of pounds while those worth in excess of £2 million will be saddled with probate fee bills of £20,000.
Inheritance tax is one of those contentious areas of taxation which is almost impossible to pitch correctly to the electorate. With so many people having different views on the subject – and indeed single individuals capable of possessing seemingly conflicting views – it is very much a "damned if you do and damned if you don't" kind of affair.
Whatever the case, the process of inheritance tax and probate in general presents considerable challenges to the personal representatives of estates, regardless of whether they are executors or administrators.
Against this background, it seems a little disingenuous that the government should have recently proposed to raise probate fees in the way that they have. Gone will be the flat-rate system and instead will appear a tiered system to calculate fees based on the value of an estate – call it an additional inheritance tax by stealth if you like: a death tax per se.
