The Institute of Chartered Accountants in England and Wales (ICAEW) has this week petitioned against the Ministry of Justice’s (MoJ) plans to “drastically” raise the fees paid for probate.
The leading UK regulator said proposals to increase the sums paid by families to wind up the estate of a loved one are an “abuse of constitutional powers”.
Under current plans, probate fees will be increased through statutory adjustment, rather than through the Finance Bill, which the ICAEW says will decrease “transparency and accountability in a process that will raise funds for the Exchequer”.
The changes will see fees increase to £250 for estates valued between £50,000 and £300,000 (before Inheritance Tax), rising to £6,000 for estates valued over £2 million. Notably, all fees will have to be paid by the executor in advance of selling the assets.
This is compared to the current system, in which a flat fee of £155 is applied to all estates over £5,000 when probate is applied for by a licensed probate practitioner, increasing to £215 when the application is made by family or friends.
Commenting on the planned adjustments, Jane Berney, ICAEW Business Law Manager, said: “When MoJ first consulted on these changes in 2016, 97 per cent of respondents were against them, yet the department is still going ahead.
“Moreover, the Parliamentary Joint Committee on Statutory Instruments (SI), made up of MPs and peers, reviewed the proposals and concluded they were unlawful. They said pushing through the increases by SI was beyond the powers of the Lord Chancellor, as the increase was equivalent to putting a new tax in place as the fees were disproportionate to the service provided.”
Ms Berney added that the new fees should be made subject to the right scrutiny, “like any other tax”.
The Government has yet to confirm when the fee increases will go into effect.