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Increased Probate fees constitutes a Stealth Tax putting Elderly People at Risk

The Government has announced controversial new plans to radically increase the application fee to apply for probate.

What is a Grant of Probate?

When a person dies their personal representative will often have to apply for a Grant of Probate (or Grant of Representation). This is the formal authority for them to deal with their estate according to their Will (or the law on intestacy).

Until the application for a Grant of Representation has been approved by the Probate Registry the personal representative is unable to manage the assets of the estate. Banks will not release the funds held in bank accounts and the deceased’s house cannot be sold until probate has been obtained.

Why is the fee increase controversial?

You apply for the Grant of Representation by making an application to the Probate Registry.
At present the application fee for probate is £215 or £155 if a solicitor helps you. However as of April 2019 HMCTS is implementing a tiered set of fees. Incredibly the fee will rise overnight in some cases from £155 to £6,000 despite the exact same service being provided.

Estate value  i Fee
Up to £50,000  i Nil
£50,000 to £300,000  i £250
£300,001 to £500,000  i £750
£500,001 to £1M  i £2,500
£1,000,001 to £1.6M  i £4,000
£1,600,001 to £2M  i £5,000
Over £2M  i £6,000

The fees have been reined in from last year’s original proposals which would have seen charges of up to £20,000 for large estates. The proposal was widely criticised by lawyers and in the media as a “stealth tax”. The Government has argued that the increased fee is warranted to support the struggling court system.

As many people in Poole and Bournemouth own a high value property but are short on cash and savings there are concerns that local families will struggle to pay the fees before they can access the money locked in the deceased’s estate.

Private Client lawyer Clare Lawson said: “We are already seeing cases of “impecunious executors” who are unable to personally lend the estate money to pay the probate fee as well as cover insurance costs and who can’t get assistance from banks”.

National organisation Solicitors For The Elderly have also argued that the increase in fees makes elderly people vulnerable as they may be pressured avoid the fee by making huge financial gifts at times of illness and confusion to reduce the size of their estate

Clare added: “The important thing is to make sure you understand all the implications of lifetime gifts and check that what you’re doing will solve the problem and not create new, more expensive ones. I would encourage anyone who is concerned about the stealth tax to speak to a lawyer before taking any drastic action.”

“For example, the taxman is taking an increasingly forensic approach to investigating transfers of property made before death. These gifts often give rise to all sorts of complications and unexpected tax consequences.”

If you would like advice on lifetime gifts or applying for a Grant of Representation you can contact our friendly and approachable Wills, Trust and Probate lawyers based at our Bournemouth and Christchurch offices:

Clare Lawson – Moordown – 01202 527008
Lloyd Thomas – Lansdowne – 01202 294411
Andrew Lilley – Highcliffe – 01425 282150

Please note, this is not legal advice. It is intended to provide information of general interest about current legal issues.



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