Some will remember that back in 2017 the Government put forward proposals to increase the court fee payable on the obtaining of a grant of representation to an estate from the current level of £155 for solicitor applications and £215 for personal applications to an amount that was linked to the value of the estate, irrespective of the beneficiary or inheritance tax position of an estate.
The Government regarded this step as necessary to ensure adequate funding for the court service.
These proposals were controversial and the majority of the respondents who replied to the consultation disagreed with the proposals, regarding an increase in the court fee payable being linked to the underlying value of an estate to equate to a stealth tax, as the fee proposed did not reflect the actual cost of the service.
Despite these views, the draft order was passed by Commons Committee debate. However there was not enough time for the Order to obtain parliamentary approval before parliament was dissolved ahead of the General Election in June 2017 and the proposed revision to the fees stalled.
Whilst the Government appears to have been quiet on this subject since the summer of 2017, earlier this month revised proposals to increase the court fee payable on an application for a grant of probate were laid before parliament. As before this order does require both Houses approval to become law.
The new proposed fees are lower than those given in 2017 but still result in a significant increase from the current fee, even at the lowest level. The new proposed fee structure which looks set to apply from April 2019 as against the previous proposal is as below.
Proposed new fee structure
Value of estate (before inheritance tax) Fee proposal Fee proposal
Up to £50,000 or exempt from requiring a
grant of probate £0 £0
Exceeds £50,000 but does not exceed £300,000 £300 £250
Exceeds £300,000 but does not exceed £500,000 £1,000 £750
Exceeds £500,000 but does not exceed £1m £4,000 £2,500
Exceeds £1m but does not exceed £1.6m £8,000 £4,000
Exceeds £1.6m but does not exceed £2m £12,000 £5,000
Above £2m £20,000 £6,000
Source: The Government Response to Consultation on Proposals to Reform Fees for Grants of Probate, February 2017,
Explanatory Memorandum to the Non-Contentious Probate (Fees) Order 2018
This would once again mean that even though an estate may not be subject to inheritance tax due to the beneficiary qualifying for either a spouse or charity exemption, if the proposed court fee becomes law, they will still be greeted with a higher court fee if the value of the estate passing under the grant exceeds £50,000.
In addition unless the Government confirms that the court fee is based on the net value of an estate for Inheritance tax purposes rather than the net value which passes under the grant, then some may wish to seek advice as to both the benefits and disadvantages of owning assets jointly so as to either remove the requirement for a grant to be obtained or reduce the value of the estate that passes under the grant and therefore the court fee which would be payable.
For further information please contact Victoria Green on firstname.lastname@example.org or 01392 333878.