After the government was told their proposed Probate fee hike to £20,000 from £155 (a 12,900% increase on the current fee) for a £2m estate was unlawful, they went back to the drawing board and reduced the fee - a bit. It is now proposed that the maximum Probate fee will be £6,000 which is a mere 3,800% increase.
Charities have, however, hit back as they claim they will be disproportionately affected by the changes given that 87% of charity legacy income comes from residuary bequests (and it is the residuary estate which would bear the full cost of the Probate Fee).
Another group unreasonably affected (in my view) is spouses. Gifts between spouses pass free of inheritance tax but under the new fees regime, spouses passing assets to each other on first death would be liable for the new increased fees - it just looks like taxation by stealth to me.
Fortunately, the Labour Party have indicated that they will oppose the fee hike when it comes before Parliament in April which at the very least means it will have the opportunity to be debated rather than simply waved through (as would be the case if it were unopposed).
It will be interesting to see whether the concerns raised by charities find sympathy with the Justice Minister.
the proposed new fee structure has ‘unintended consequences that could be detrimental to charitable giving’