The New Death Tax

Posted By: on 16th November 2018 | Category: Probate and Estate Administration

A week after the budget and a sting in the tail. The government will re-introduce the unpopular and unfair increase to the fees for obtaining a grant of probate by Statutory Instrument with effect from 27th November 2018. You might recall their attempt to do this last year, which was withdrawn due to the general election.

This 2018 proposal is not quite as eye-watering as the 2017 one but still introduces a tiered set of fees for what is, for the vast majority of estates no matter their value, an identical level of administrative work and paperwork. Where the fee imposed for an identical level of work is greater just because the value of the estate is greater, we should call this what it is: a tax.

The Government is attempting to use the Statutory Instrument process to bring this in by stealth leading to increased costs imposed on already grieving families.

No one can argue that the fees do not need updating. They have been at the same level now since 2014 and a modest increase would not be out of order. What is proposed is not a modest increase.

The proposed fees are as follows:

Value of Estate Previous Fee for personal applications Proposed Fee for personal applications % increase from previous fee % increase from new basic fee of £250
Up to £5,000 £0 £0 0 0
£5,000 – £50,000 £215 £0 -100% -100%
£50,001 – £300,000 £215 £250 +116% Basic fee
£300,001 – £500,000 £215 £750 +349% +300%
£500,001 – £1m £215 £2,500 +1,163% +1,000%
£1m – £1.6m £215 £4,000 +1,860% +1,600%
£1.6m – £2m £215 £5,000 +2,326% +2,000%
Over £2m £215 £6,000 +2,791% +2,400%

If you are in the beginning stages of dealing with the probate of a loved one, notwithstanding the difficult and painful circumstances, it might be time now to speed up your information gathering and make an application before the fees are imposed. When will they be imposed? As yet, no date has been set for the introduction but last time the government tried to introduce this they gave only one month’s notice.

In the meantime various professional bodies are objecting to the introduction of this stealth tax. It is not guaranteed that they will be successful in preventing its introduction.

Coole Bevis’ specialist probate advisers can assist with this and advise you as to your options. Call 01273 722532 or email info@coolebevisllp.com to set up a consultation.

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