Smith Partnership Solicitors, celebrating its 30th anniversary this year considers the impact of the proposed increase in the Probate fee regime.
What is a Grant of Probate?
A Grant of Probate is a court document issued by the Probate Registry which formally appoints the Executors named in a deceased person’s Will. This document certifies that the Executors are the people who are entitled to deal administration of the Estate and many financial institutions require sight of the Probate before they can deal with the deceased person’s assets.
The Executors have very limited power to deal with such assets until Probate has been granted to them. To apply for the Grant of Probate, the Executors are required to complete an Inheritance Tax return, pay any Inheritance Tax due, submit a sworn oath to the Probate Registry and pay the court fee. The fee is currently £155 and this is a universal flat-rate for every application.
In February, the Ministry of Justice announced that the Probate fee regime would be changed. It was proposed that the fee will be linked to the value of the estate but it may mean that Estates exceeding £2m will need to pay a fee of £20,000 before a Grant of Probate can be issued.
Luke Smyth, Solicitor in the Wills and Probate department says “On the face of it, this could be seen as proportionate and fair. However, when you consider that the process and cost to the Probate Registry is the same for every application, it is arguable that the intended proposals will result in profit-making for the court and it is, to all intents and purposes, a tax by another name. Not only is the proposed fee increase staggeringly disproportionate, the government has given little regard to how the fee is going to be funded. Executor cash-flow concerns have largely been ignored by the government.”
“Many banks and building societies will release funds directly to HMRC to enable the payment of Inheritance Tax. It is hoped (but it is not certain) that banks will do the same for the Probate fees. If not, then the Executors or the bereaved family members will have to fund the fee personally and then subsequently claim it back from the Estate.”
“The proposed fee increase has understandably received widespread criticism, not least from solicitors and MP’s alike. Indeed, a parliamentary joint committee has suggested that the fee changes will need to be approved by parliament but they come into effect. That remains to be seen, and we now eagerly await the news as to whether the fee regime will be altered to such a dramatic extent.”
If you’d like to find out more about the legal services offered by Smith Partnership, don’t hesitate to contact us via email@example.com. Alternatively, speak to a member of our team directly on 0330 123 1229.