- 27th March 2019
- Posted by: Suzy Hill
- Category: Personal Tax
Probate fee rise delayed as parliamentary time limited
The changes to probate fees have been delayed due to pressure on parliamentary time due to Brexit debates and motions, with the draft statutory instrument still awaiting an approval motion in the Commons.
The Ministry of Justice has confirmed that once the motion is approved, the new probate fee regime would come into effect 21 days later, not on 1 April as originally envisaged.
The new fee structure is unlikely to come into force until late April at the earliest, depending on parliamentary time.
No date has been set for a parliamentary motion for the draft Non-Contentious Probate (Fees) Order 2018, which was initially laid before parliament on 7 February.
Under normal circumstances, secondary legislation is passed without debate, as it is procedural. However, MPs can object, in which case an SI is not automatically approved. This can lead to a subsequent debate and possible amendments, which would delay any introduction of new fees.
The Ministry of Justice plans to change the current flat rate fee for probate to one based on the value of the estate, which originally was due to take effect from 1 April.
For the time being the current probate fee structure will remain in place as will the current registration process, the Ministry of Justice confirmed, with the pre-HMRC inheritance tax registration required.
There has been confusion among advisers, who were expecting the rules to come into effect from next week and HMRC has reported a high level of calls from advisers asking about the current process to register an estate for inheritance tax through HMRC, which is mandatory before any registrations for probate.
An HMRC spokesperson stated: ‘The helplines were getting calls about the new probate fees – there is some confusion from our customers and a lot of people calling the helpline about this, asking about what was happening.’
However, to help advisers HMRC is relaxing its position on the inheritance tax registration process.
‘Probate registries will accept applications before processing by us as long as they are assured the IHT forms from us will be coming shortly. This is so people don’t need to be in a mad rush getting the forms from us, which will slow processing down, while we wait for the changes to come in,’ an HMRC spokesman confirmed.
‘Our processes aren’t changing, it’s just that probate registries will be willing to accept applications before our processing is done when normally it would need to be after.’
Therefore, to get probate the person dealing with the estate can wait to submit an inheritance tax account to HMRC before starting the probate process. This is because probate registries will not accept an application for probate until HMRC has confirmed that it has processed the inheritance tax account.
New fee proposal
Probate fees are set to increase to £6,000 for the largest estates under government plans to overhaul the death tax from April 2019, a measure delayed from 2017 due to the snap general election in June 2017.
The new fee regime is based on a banded structure depending on the value of the estate and no longer applies a flat fee.
The probate fee threshold will be raised from £5,000 to £50,000. This will exempt approximately 25,000 additional estates per year from paying fees altogether while more than half of estates will pay no probate under the higher threshold.
Proposed probate fees – Ministry of Justice
|Value of estate (before inheritance tax)||Proposed fee|
|Up to £50,000 or exempt from requiring a grant of probate|
|£50,000 – £300,000|
|£300,000 – £500,000|
|£500,000 – £1m|
|£1m – £1.6m|
|£1.6m – £2m|