Probate fee hike scrapped. Could inheritance tax go the same way?
The government has confirmed this week that the proposed hikes in probate fees, which were due to come in to force in April 2019 but were delayed as a result of Brexit, have been scrapped.
As reported in our previous article on the subject, the proposed increase would have seen some estates having to pay a £6,000 fee to apply for a grant of representation, whereas at the moment the fee is £155 for those using a solicitor and £215 if the personal representative is applying to the court for a grant on their own.
The Government has said that probate fees will be reviewed as part of the annual assessment of charges in family and civil courts, and its change in stance has understandably been welcomed by professional bodies such as Solicitors for the Elderly (of which Bolt Burdon’s Michael Culver is Chairman) and the Law Society.
Separately, at a fringe event at the Conservative Party Conference earlier this month the Chancellor, Sajid Javid, mentioned that he was uneasy about making people “pay taxes all over again” when they die and that the possibility of getting rid of inheritance tax was “on my mind.”
The following week Robert Jenrick, the housing secretary, talked about the “fundamental unfairness” of the tax and stated that he could “see why the Chancellor [was] interested” in reforming inheritance tax.
Currently, subject to certain exceptions (such as the residence nil rate band) inheritance tax is charged at 40 per cent of estates worth more than the tax free level of £325,000, or £650,000 for couples.
With the next budget due on the 6th November it is important that if you have existing inheritance tax planning measures in place that you watch this space, because if significant changes to inheritance and other taxes are to be included such measures will need to be reviewed.
If you have questions about probate fees or on inheritance tax please feel free to contact Sunir Watts who specialises in inheritance, capital gains and income tax planning or you can also contact one of our other solicitors in the Wealth Planning team here.