Unsurprisingly, a House of Lords Committee have condemned the government’s amendments and reforms to probate fees.
The negative comments echo the sentiments expressed by the Lords during the government’s first suggestion of a tiered and incremental probate system in 2017.
Because the government ensured the rules were laid using a negative instrument, the proposals did not need to go through parliament in order to become law. Consequently, the Non Contentious Probate Rules 2018 amendments have been signed by an MP and will now come into law by the end of November.
Following the fact that proposals have been made into law through a shady back door loophole, the House of Lords’ ‘Second Legislation Committee’ believe that the commonly known ‘stealth death tax’ has actually been an ‘abuse of levying power.’
A statement from the House of Lords said: ‘Although, in this new version, the scale of the individual fees has been reduced, the committee has not changed its view on the underlying principle, that is that the fee bears no relationship to the actual cost of approving the probate application and has the appearance of a tax.’
The committee adds: ‘In considering the policy the house may wish to bear in mind that those with higher value estates will already be contributing to the Exchequer through inheritance tax and stamp duty of up to 12% if a property is sold. It is also worth remembering that such estates are often divided between a number of beneficiaries, many of them charities.’
These remarks have followed widespread and unequivocal opposition of the Probate Rules 2018 Amendments. Many charity officials have anxiously estimated a loss of £10 million with others questioning how the money will be extracted as lenders will not allow property to be sold in order to pay for the probate fee.
Despite the fact that the House of Lords reputation for housing the retired affluent and powerful members of society that would generally oppose a tax on the rich, it is becoming clear that such overwhelming discontent from those opposed to the sneaky fee have just garnered another influential ally.
How will the new fees system enforce the payments? What will this mean for expensive estates that have all assets tied up in property?
