The Government has announced it's scrapping a controversial new system for charging probate fees, following parliamentary delays and campaigns against the plans.
The planned change would have seen estates in England and Wales paying as much as £6,000 to receive a grant of probate, which is required to administer the estate of someone who has died.
Under current rules, the fee is charged at a flat rate of £215 for any estate worth more than £5,000.
A new fee system was set to take effect on 1 April 2019, which would have introduced probate fees on a sliding scale, so that executors of higher-value estates would have been charged more.
The measure was delayed back in March, and it's now been confirmed that the change will no longer go ahead.
Confirming the decision, a spokesperson from the Ministry of Justice (MoJ) said:
"While [probate] fees are necessary to properly fund our world-leading courts system, they must be fair and proportionate.
"We will withdraw these proposals, and keep the current system while we take a closer look at these court fees as part of our annual wider review."
The proposed system
The new system would have meant fees were charged at different amounts, depending on the value of the estate.
Under these fees, estates worth less than £50,000 wouldn't have had to pay a fee to receive a grant of probate, while those above £2 million would have paid £6,000.
|Value of estate before inheritance tax||Proposed fee|
|Up to £50,000 or exempt from requiring a grant of probate||£0|
|£50,000 - £300,000||£250|
|£300,000 - £500,000||£750|
|£500,000 - £1m||£2,500|
|£1m - £1.6m||£4,000|
|£1.6m - £2m||£5,000|
|Source: Secondary Legislation Scrutiny Committee, 21 November 2018|
Why were the changes cancelled?
For the new fee structure to come into effect, a motion had to be passed by Parliament.
Since March this year, a change of prime minister and ongoing Brexit negotiations have left very little parliamentary capacity for this, so the legislation has not been put before MPs.
Pressure from various campaign groups may have also influenced the decision. Many argued it was unfair to charge significantly higher fees for a service that would cost the same to fund regardless of the size of the estate.
Concerns were also raised by a House of Lords committee that the fees constituted a ‘stealth tax', as they would have been used to fund other parts of the courts and tribunals system.
Simon Davis, president of the Law Society, said:
"Not only would these charges have been excessive but they could have caused significant cashflow issues for the bereaved.
"The Government's decision to raise probate fees via statutory instrument was particularly concerning as it would have allowed the fee increases to bypass full parliamentary debate. This would have set a dangerous precedent."
What does it mean for you?
If you're the executor of an estate and need to apply for a grant of probate, you'll need to pay the current flat-rate fee if the estate is worth more than £5,000.
However, some disruption has already been caused, as many executors aiming to avoid the expected hike in fees rushed to submit their applications before April. This could mean you have to wait much longer than usual to receive a grant of probate.
HM Courts & Tribunals Service (HMCTS) said the volume of probate applications was 50% higher than usual monthly volumes in March and April 2019.
This coincided with the service's switch to new IT systems, causing long delays to the processing time for applications.
In August 2019, waiting times stood at around six to eight weeks, but HMCTS said it is working hard to reduce the current backlog.
Talk to us about non-contentious probate.