Controversial proposed probate fee increases have been scrapped by the Government because, it says, there is too little parliamentary time before the snap general election to push the legislation through.
The move – which could lead to the changes being dropped altogether – follows pressure from organisations including Solicitors for the Elderly (SFE), a body of which the majority of Wards Solicitors’ probate team are members.
Jenny Pierce, head of the Wills, Probate and Mental Capacity team at Wards Solicitors and regional coordinator for SFE in Bristol and Bath, said: “We are delighted to hear the proposed probate fees have been dropped. It was clear from the outset that the new system was nothing more than a backdoor tax and Government had abused its powers in pushing them through under the guise of a fee.
“To call the new system ‘proportionate’ was frankly ridiculous when you consider that some larger estates were set to see an almost 13,000 per cent increase in fees.
“What’s more, by proceeding with the changes, ministers point-blank ignored the views of almost every respondent involved in the consultation process.
“Since then, SFE has campaigned hard, alongside other organisations, to have these changes reviewed. SFE is made up of more than 1,500 lawyers across the country and not one member agreed with the fees.”
Fear and worry
About 2.5 million people in England and Wales own properties worth at least £300,000 meaning that many would have been hit with a probate bill of at least £1,000.
Jenny Pierce added: “We have seen a dramatic increase in enquiries from older and vulnerable people worried about the fees.
“Our fear was that some people may have been led to attempt to avoid the fees by decreasing the value of their estate, thereby leaving themselves with insufficient assets to provide for the rest of their life.
“With the current social care crisis affecting the country, the unintended consequences of this change could have been disastrous. We are extremely relieved to hear this has now been avoided.”
The proposed changes – from which the Treasury stood to gain an extra £1.5 billion – have caused controversy from the start. Just last month, a parliamentary joint committee on statutory instruments branded the planned increases as unlawful.
And a petition set up asking the Government to think again about its plans gathered more than 38,000 signatures
The changes would have affected most estates from May this year. Instead of the current flat rate of £215, or £155 if applying through a solicitor, a new band of charges was set to be introduced meaning that the more an estate was worth, the bigger the probate fee beneficiaries would have to pay.
Executors for estates worth between £500,000 and £1 million, for example, would have had to pay £4,000 and estates valued at over £2 million would have incurred a charge of more than £20,000 representing a staggering 12,900 per cent increase.
What happens now?
Political sources have suggested that the wealth of opposition to the proposed probate fee hikes means they are unlikely to be reintroduced after the election. And that the Conservative Party hasn’t yet decided what to do on this issue if they are returned to Government in June.
Ultimately, it will be up to the next elected Government – whichever party that is – to decide whether to push through the plans on probate or not.