Revived plans to hike probate fees will saddle grieving relatives with thousands of pounds of bills and are “grossly unfair”, a leading tax lawyer has warned.
The alert has come from tax expert Gary Priest after the Government said it is ploughing ahead with changes to court fees, scrapping the simple fixed fees in favour of an unpopular sliding scale.
Mr Priest, a partner at law firm mfg Solicitors, said the new plans were an improvement on a similar proposal that was scrapped ahead of the 2017 General Election, but that they still amounted to a “stealth tax”.
The new Whitehall-led arrangements will scrap fixed fees of £215 for individuals and £155 for anyone applying through a solicitor. Instead, people will pay up to £6,000 depending on the value of the estate. The government has said it is a 70% reduction on the original plan for a £20,000 maximum fee, which was dropped before the election.
Mr Priest said: “The Ministry of Justice will dress this up as an improvement on its original, highly controversial and utterly unjustifiable plans.
“However, it is still a stealth tax. People will still pay potentially thousands of pounds for exactly the same service they were receiving before for a few hundred. The flat fee was simple and it was fair. This is just a new form of Inheritance Tax by another name.”
“The whole point of this was to make the system fairer and cheaper for people with lower value estates. Yet the amount by which fees have been hiked for higher value estates is unjustifiable.
“The anger that greeted the proposal before the General Election made the government think again, but all it’s done is water the plan down rather than make it fit for purpose. It remains fundamentally flawed and grossly unfair.”
Mr Priest added that he was concerned the measures could encourage people to try to avoid probate by transferring valuable properties into joint names with their children.
He added: “There are consequences for people’s financial security and the risk of increased capital gains tax when measures are taken to try to avoid probate. Anyone thinking of the estate they intend to leave for loved ones must be properly advised so they avoid the pitfalls.”