The reintroduction of a cap on the amount of probate duty payable on a deceased person’s movable property held in Jersey has been welcomed by offshore law firm Carey Olsen.

On 5 December, the island’s parliament voted to bring back the cap, part of the jurisdiction’s stamp duty regime.

The administration of a deceased person's movable property (property other than land) located in Jersey has attracted a charge to probate duty for many years. The duty, which is payable when the applicant (usually the deceased's executor or closest heir) applies for either a grant of probate or letters of administration in Jersey, is calculated by reference to the value of the deceased's net movable estate situate in Jersey at the date of death.

Historically, the duty has been fixed at around £80 ($129) of duty for each £10,000 of net value, Carey Olsen explained in a note.

Until 2005, there was a cap on the amount of probate duty payable; the amount of stamp duty payable did not increase once the value of the net movable estate reached £13,360,000. The effect of this cap, Carey Olsen said, was that the maximum amount of probate duty payable on the deceased's Jersey estate was £100,000.

This cap was seen as a useful feature in Jersey's financial services regime as it encouraged high net worth individuals to deposit significant funds in Jersey, safe in the knowledge that, on their death, the maximum amount of probate duty payable would be fixed and certain.

“The cap was removed in 2005 and its reintroduction on the same terms is to be warmly welcomed by the private wealth industry as it removes a potential barrier to investment by HNWIs in the island,” the firm said.