The Justice Secretary, Robert Buckland, has abolished the proposed increase in probate fees due to come in next year.

The Daily Mail reported the ‘death tax’, which could have seen families charged up to £6,000 has been scrapped. The tax would have affected some 300,000 families. However, Mr Buckland has decided the rise in probate fees is not “fair and proportionate”, and it will not go ahead. The charge would have risen according to the value of an estate. At present, families pay a flat fee of about £155 to secure legal control over a deceased’s estate. The new charges might have seen fees from between £2,500 and £6,000.

A review of court fees starts within weeks and is to involve “small adjustments” to cover costs, but officials have insisted grieving families will not be expected to pay thousands of pounds for probate fees.

Extra £185 million

The proposed change would have raised an extra £185 million for the Ministry of Justice by 2022/23, but instead a wider review of court fees has been ordered by ministers.

Mr Buckland told the Daily Mail fees were necessary to fund the country’s “world-leading” courts system, they needed to be fair and proportionate.

From April next year, the threshold for which inheritance tax comes into effect will increase to £1 million for couples who wish to pass on their family home. The proposed probate fee increase would have come into effect at the same time.

Fees to fund improvement

The change to the law was announced last November when a sliding scale of fees linked to an estate’s value had been planned. At the time, ministers argued only very large estates would pay the largest fees. In addition, the Government argued that the increase would mean probate fees could help fund improvements in the court service. Critics called it a stealth tax, saying it was wrong to use fee-raising powers designed to pay for processing paperwork to raise money. The Law Society argued against the move, calling it a tax on grief which would have caused significant cash flow problems for those who were asset rich but cash poor such as pensioners and farmers.

The Society also said it objected to the fees because they represented a misuse of the chancellor’s power to levy fees, which could set a dangerous precedent for future tax rises.

Step, the professional organisation for inheritance and trust advisers, said the move to scrap the proposed fee increases followed months of work by Step and others to highlight the unfairness, and at last brought an end to the uncertainty.

 

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