Rising probate fees: the Conservatives’ stealth mansion tax
This time last year, we were in the full swing of a General Election. One of the issues over which the Conservatives particularly attacked Labour, was the plan for a mansion tax on properties worth over £2 million, with all sorts of scare stories about how much it would be, and that it would be charged on less valuable properties. It’s clear that this policy was not popular in parts of London due to higher property values, and may have played a part in people deciding to cast their vote elsewhere.
Imagine my surprise, therefore, when lo and behold, the Conservatives are now proposing their very own stealth mansion tax, and a tax that goes much further down the scale, too!
In a little publicised announcement of 18 February, the Ministry of Justice is now consulting on a huge increase in probate fees, paid on the value of the estates of deceased- and not just real estate, but everything to be passed on. In addition to Inheritance Tax liabilities, beneficiaries would see their inheritance dramatically reduced under the Conservatives’ scheme.
Through this tax increase designed to raise an extra £250 million a year, under the plan, estates worth over £500,000 will have to pay £4,000; those worth £1 million, £8,000; and estates of £2 million or more, a whopping £20,000 – a mega increase on the current fee of just £155, if the application is made by a solicitor.
What’s more, they aren’t going to make it any easier for you- but it will be easier for them, as probate applications will be moved from the current paper-based forms to an online system.
The Conservatives say it is all about ‘reducing worry for executors at what is often a very difficult and distressing time,’ – but it seems to me that this new swingeing tax, which bears no relation to the amount of work the government administrators will be doing- will do nothing of the sort: it will increase worry and distress, as executors will have to find the tax up front to take out the grant of probate to finalise their deceased loved one’s estate.
This is a stealth mansion tax, pure and simple!
