Solicitor Patrick Brennan, in our leading Probate, Tax & Trusts team, highlights the Government’s response to the 2016 consultation on a proposed increase in Probate court fees.
The Government has issued its response to a consultation that took place in 2016 regarding proposed increases to the fees payable when applying to the Probate Registry for a Grant of Representation.
Despite over 97% of the responses to the consultation expressing disagreement with the Government’s proposed new fee structure, it has decided to press ahead with scrapping the current flat-rate fee and replacing it with a system whereby the value of the Estate will dictate the amount of the fee.
Whilst the threshold below which no fee is payable has been increased from £5,000 to £50,000, all other Estates will now pay a higher fee than before. The minimum fee will now be £300 (up from £155), with Estates over £2m subject to a £20,000 fee. It is proposed that the changes come in from May 2017.
The move is part of a drive to reduce the costs of running courts and tribunals, and to raise £250m for the Exchequer. However, the dramatic increase has led many in the legal profession to accuse the Government of implementing a “stealth tax” on high value Estates, noting that the work undertaken by a Probate Registry is the same no matter the value of the Estate. A £20,000 Court fee on a £2m Estate has the same effect as increasing the rate of Inheritance Tax by 1%.
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This article is intended for the use of clients and other interested parties. The information contained in it is believed to be correct at the date of publication, but it is necessarily of a brief and general nature and should not be relied upon as a substitute for specific professional advice.