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Fresh U-turn as Government ditches 'death tax' ahead of election

21 Avril 2017

The fees would have raised an estimated £300m per year in extra revenue at the same time changes made by the Conservative government have this month lowered inheritance tax by introducing a separate tax-free allowance of £175,000 for homes.

The government has dropped plans to sharply increase probate fees before the election, raising the possibility that the proposals could be dropped altogether. This executor then has to apply for a "grant of probate" from the probate registry to deal with the estate.

Under the proposed changes, this system would have been replaced by a sliding fee scale linked to the value of the estate.

Meanwhile the estate threshold below which no fees are required was due to rise from £5,000 to £50,000 - lifting some 25,000 estates out of the system. Those valued at more than £2 million would have incurred a £20,000 charge, which is represents an enormous increase on the current fees.

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Now applications for a "grant of probate" cost a flat rate of £215 each, or £155 for those made through a lawyer.

Now that a general election has been called, the MoJ has confirmed that the relevant statutory instrument would not be completed before the election, meaning the proposals will not be put before this Parliament before it dissolves. But the Ministry of Justice has now admitted it does not know the unit cost of handling a probate application and sees no reason to find out what it is.

"It's also important to highlight the emergency claims payment process that many providers, including Scottish Widows, have in place to aid bereaved families in hardship, and which pays a proportion of the death claim quickly so that funeral costs can be paid in advance of probate".

Refers to the legal document which allows an individual (donor) to nominate a person or people (attorneys) to make decisions on his or her behalf should they reach a state where they no longer have the mental capacity to make certain decisions.

Fresh U-turn as Government ditches 'death tax' ahead of election