A summary of key legal updates for the Private Client sector over the past week is as follows.   

Online probate timescales

The Law Society has issued an update from a probate service user group meeting attended by HM Courts & Tribunals Service ("HMCTS") and professional bodies. The feedback from HMCTS at the meeting includes the following.

  • Timeliness is still a problem, with the average application issue time just under nine weeks.
  • HMCTS is committed to getting back to pre-COVID levels of outstanding work: the aim is to return to the normal active case load of three to four weeks intake by March 2022, which will reduce the time periods. However, this is subject to the impact of the winter period on the death rate.
  • To help avoid a "stop" being put on the case: if the Will/ Codicil appears to have been changed or damaged, use the notes field on MyHMCTS to let HMCTS know. This can avoid unnecessary delays to the grant of applications.
  • HMCTS will be updating the digital and paper applications in respect of the recently announced changes to the IHT exempt estates rules.

Probate service update – November 2021 | The Law Society

LPAs and donor's medical records

The Office of the Public Guardian ("OPG") has issued guidance for NHS staff that an attorney under an LPA or a court-appointed deputy should be able to access medical records of the donor to facilitate best interest decisions. The requirement stems from the Mental Capacity Act 2005 and Code of Practice and the need for public authorities to support attorneys/ deputies in the discharge of their duties, but also crosses over with data protection law and the ability for third parties to make a subject access request. Before releasing medical records, NHS staff should search the OPG's registers to verify the attorney's/ deputy's authority, be satisfied that the attorney/ deputy needs the information to act properly and disclosure is in the patient's best interests. See also Ann Stanyer's update on this new guidance. OPG confirms LPA holders and deputies in England and Wales are entitled to see donor's medical records | STEP

France and the EU Succession Regulation

France's recently revised inheritance law, which gives certain beneficiaries the right to claim a "compensation levy" if they are excluded from benefitting from a French estate (for example, due to an election for another national law to apply under the EU Succession Regulation 650/2012), has come to the attention of the European Commission, which is examining its compatibility with the Regulation. The law came into force from 1 November 2021 and was introduced to protect Muslim women where Shariah law was to be used, but because it has been drafted so widely, applies to all international successions. It therefore affects UK nationals with French property if they or their relevant beneficiaries are resident in an EU member state at the date of death. The law could be revoked if the European Commission demands it, or there is a relevant ruling in the European Court of Justice, but either route could take several years. French Inheritance Law Under EU Investigation | French-Property.com

Offshore trust distributions - reporting

In Lawson v HMRC [2021] UKFTT 367 (TC), the FTT upheld an HMRC information notice to establish the nature of a distribution from an offshore trust. The case illustrates the extent of HMRC's data collecting and information gathering powers in respect of distributions from offshore trusts. The beneficiary (who had not reported the distributions in his tax return) had appealed the information notice, arguing that HMRC did not need further information; the offshore trust company in question had written to HMRC to confirm that the distributions to the beneficiary were of capital not income. The FTT rejected the appeal and upheld the notice, finding that HMRC reasonably required more information to check the tax position, has good reason to suspect an underpayment of tax, and should not be expected to rely on the word of the trust company alone. Weekly Tax Update 10 November 2021 | Smith & Williamson (smithandwilliamson.com)