The snap General Election has put a stop to planned increases in Probate Fees for England and Wales.
Once an election is called, there is usually a period – known in parliament as a ‘wash up’ – during which outstanding legislation is passed, modified and passed, or simply killed off, all in a matter of days.
It is no surprise to anyone that it is the more controversial proposals which generally get buried, as the timescale will almost always require cooperation from the opposition to rush law on to the statute book. Hence Theresa May’s decision to call an election at seven weeks’ notice meant that all of the outstanding legislation – including a 762-page Finance Bill – had to be dealt with in the space of a fortnight!
One piece of legislation which was dropped was “The Non-Contentious Probate Fees Order 2017”.
It had reached the draft regulation stage, at which point it was proving to be anything but non-contentious. The order was to have restructured Probate Fees in England and Wales, moving them from a flat fee of up to £215 to a variable fee that started at £300 for estates valued at between £50,000 and £300,000 to a £20,000 fee for estates worth over £2,000,000.
The proposal for significantly higher fees provoked predictable ‘new death tax’ headlines and, indeed, one committee of MPs questioned their legality by contending that the proposed charges “appear…to have the hallmarks of taxes rather than fees”.
Unsurprisingly, instead of facing a battle for which it did not have time (and perhaps even the political appetite), the Ministry of Justice abandoned the proposed legislation and it is uncertain whether it will return after the election.
Whilst the Probate Fee increase has disappeared – at least for the time being – the legislation introducing the new Residence Nil Rate band came into force from April so if you have not yet reviewed your estate/Inheritance Tax planning in the light of its introduction, now is the time to do so – get in touch.
Please Note: The value of tax reliefs depends on your individual circumstances. Tax laws can change. The Financial Conduct Authority does not regulate tax advice.
