Probate fees increase – further guidance issued

By 27th March 2017 Probate No Comments

In response to the recent changes to probate fees, the Ministry of Justice (MOJ) has now issued further guidance to help clarify how the proposed increase in fees will work in practice.

 

A common concern was the “Catch 22” scenario, as outlined in our previous article of 3rd March, whereby Executors would be unable to obtain probate without paying the proposed fee, but would be unable to access the assets in the estate to pay the fee without first obtaining the Grant of Probate.

 

In response to this particular issue the MOJ have advised that Executors will be able to ‘apply to the probate service to access a particular asset for the sole purpose of paying the fee’. It is not yet clear how wide the scope of this access will be, and may not provide any relief where the main asset in the estate is the property, as this must be sold in any event once probate has been granted. It may however be beneficial to Executors handling an estate with significant assets in stocks & shares and investments, as ordinarily such assets cannot be accessed without first obtaining probate, irrelevant of the value of the holding or number of shares held.

 

In addition to the above the MOJ have also advised that it will be possible to submit an early application for probate pending the required approval from HMRC (approval is required by HMRC in cases where inheritance tax is due or the estate is otherwise classed as non-exempt). Any applications submitted before May will not be subject to the proposed fee increase, regardless of how long HMRC may subsequently take to approve any inheritance tax account and provide the necessary clearance paperwork after the implementation of the new fees.

 

Whilst this will certainly be a relief for Executors who are currently in the early stages of estate administration, it is likely that Probate Registries across the country will soon face a barrage of applications over the coming weeks. It is not yet clear whether any measures have been taken to help HM Courts & Tribunal Service cope with the additional workload and continue to provide an acceptable level of service to customers.

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