Probate fee hike scrapped

Posted: 24th April 2017

MOJWills and probate practitioners today welcomed the announcement from the Ministry of Justice that controversial increases in probate fees have been scrapped following the Prime Minister’s decision to hold a general election in June.

Earlier in the year, Lord Chancellor Liz Truss announced plans for a new sliding scale of fees payable on applications to probate registries for grants of representation to the estates of deceased persons in England and Wales.

The changes would affect applications for grants of probate and letters of administration where, currently, the fee payable to the court office on presentation of the papers is £155.  The MOJ planned to replace this with a scale of fees calculated according to the value of the estate.  At the top end of the scale, the maximum fee payable under the new scheme would have been £20,000.

The plan came under serious attack from critics who dubbed them a “stealth death tax”, saying that the aim of the scheme was clearly to raise revenue far beyond the requirements of funding the service for which users were ostensibly paying.  For these reasons, the Parliamentary Joint Select Committee on statutory instruments expressed the view at the end of March that the proposals were ultra-vires i.e. beyond the Lord Chancellor’s delegated powers of secondary legislation.  The Committee said:-

“The Committee has a real doubt as to whether the Lord Chancellor may use a power to prescribe non-contentious probate fees for the purpose of funding services which executors do not seek to use – namely those provided by courts and tribunals dealing with litigation.

Nobody applying for an uncontested probate would think for a moment that they were engaging in litigation.  That makes it difficult for the Committee to accept that a power to charge enhanced court fees can be extended naturally to require probate fees to reflect the general costs of the court and tribunal system.”

The committee went on to observe that the planned charges seemed to have “the hallmarks of taxes rather than fees” and reiterated the important constitutional principle that there is no taxation without the consent of Parliament.

Where it seems that primary legislation would be required and there is now limited time because of the decision to call a general election, the plans are shelved - at least for the time being.

Michael Williamson says, “It’s obviously good news for clients and their legal representatives generally but we were particularly pleased to hear about it this morning.  Only this month we have received instructions in the administration of an estate worth sufficient to attract the maximum fee under the new proposal.  That could see an eye-watering increase of £19,845 overnight.

Whilst, having pulled out all the stops, we were well on course to present the application for probate in good time, it’s reassuring to know now that our clients won’t be caught out by some unexpected and unavoidable hitch that in disastrous circumstances might see them paying 129 times more than the current fee!”

It remains to be seen whether the proposals will be reintroduced at a later stage but it’s possible that current circumstances will be seen as the ideal excuse to retreat quietly in light of what seems to be a very strong objection to taxation by the back door.

For more information on this and all other aspects of estate administration, wills, lasting powers of attorney etc email us or telephone 01460 200450.