Partner Jonathan Gater, in our leading Probate, Tax & Trusts team, discusses the government's delayed plans to increase probate court fees.
As announced in 2018, probate court fees were due to rise on 1 April. However, due to the government being consumed by Brexit and other matters, the move has been postponed.
Individuals currently pay a £215 (or £155 if they apply through a solicitor) on estates valued at over £5,000. This is set to increase to a minimum of £250, with a sliding upwards scale applicable to all estates valued at over £50,000. Those estates valued at under this amount will be exempt from any charge.
For example, this would mean that for an estate valued at £2 million, the probate court fee would be £6,000, a significant increase.
Critics have accused the government of introducing a ‘stealth tax’ but in February this year the government was able to classify the increase as a charge as opposed to a tax.
It has been suggested that we will continue to see a spike in probate applications, as individuals look to avoid the increase. HMRC is said to be under more pressure to process inheritance tax forms, required before probate can be granted, while its website has seemingly also suffered from a surge.
The Labour party has vowed to continue to contest the proposals, which could be introduced 21 days after a motion is approved in Parliament. The Party wants a vote on the issue, which could result in further delays.
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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.