Outrage at proposals to increase Probate Fees

I was sent an link to an article in the Daily Telegraph over the weekend which I thought was a joke at first. There was a story about a proposal to increase the fees which are paid to apply for a Grant of Probate; not very interesting until you see that some estates will pay a fee of £20,000, rather than the £215 maximum they would currently pay. Remember, we are not talking about the solicitor’s bill here, this is simply the amount you pay to the Court to obtain a Grant of Probate.

Lo and behold, I have today seen a copy of the consultation paper issued by the Ministry of Justice and (alas) the story is indeed true. A quick look at the table reproduced by our colleagues at STEP here http://www.step.org/news/ministry-justice-proposes-reform-grant-probate-application-fees-england-and-wales shows the proposed fees, and the percentage of estates in England and Wales likely to pay them.

The millionaire bashers will be pleased to know that estates over £2 million would pay £20,000 for having a piece of paper stamped; they might be less pleased by the likely fee of £4,000 for an estate of £500,000. While it is worth bearing in mind that probate is not always required, particularly for joint assets, these fees would be quite extraordinary. Indeed some smaller estates will pay no fee at all under the new system, though this is hardly the most eye catching part of the proposals. It is especially puzzling since much of the consultation document talks about streamlining the service and bringing parts of it online, which in most other walks of life would lead to a reduction in the fees.

So how does the Ministry of Justice try to justify this? Well firstly they point out that the Court system costs the country £1.8 billion but only brings in around £700 million in income (which is obviously all our fault). The proposed changes would raise an additional £250 million a year, a significant part of the missing £1.1 billion. So if you are wondering how this can be fair, the legislation that will be used to implement the changes is the well known ‘section 180 of the Anti-social Behaviour Crime and Policing Act 2014’. This was a measure, they tell us, brought in to ‘allow fees to be set at a level above the costs of proceedings for which they are charged.’ Anti-social behaviour – so your mother will still be misbehaving long after she has gone to her grave.

Already, many of our clients are looking to place assets outside of their estate to avoid the time-consuming and costly nature of probate; we can only assume that this will become rather more popular if these proposals are ever implemented.

Steve Wilkes is the Head of Estate Planning at Silver Lining Estate Planning Ltd, chosen by AI Magazine as the UK’s best Estate Planners in 2015.

The full consultation can be found here https://consult.justice.gov.uk/digital-communications/fee-proposals-for-grants-of-probate

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