Introduction: The Hidden Inheritance Tax

Many Ghanaians proudly say Ghana has no inheritance tax. That claim seems true at first glance. Parliament repealed the old Estate Duty Act decades ago. Since 1969, Ghana has not imposed a formal inheritance tax. Many therefore assume no levy exists today. That assumption is largely correct, but incomplete. The court fee schedule under the Civil Proceedings (Fees and Allowances) Rules 2007 (C.I.55) (as amended by CI. 86 of 2014) places a percentage charge on estate value during probate or letters of administration (L/A) process. It calls itself a court fee but behaves like a tax. That is the Hidden Inheritance Tax in Ghana, the estate duty. This article examines that uneasy overlap and proposes reforms to reduce the burden on families.

The Probate/Administration Process

When a person dies, the family of the deceased will engage a lawyer. File an application for probate or L/A. The judge will grant the application. They are very happy because the deceased left two houses, a four bedroom house in Accra and a six bedroom house in Kumasi. A combined value of almost GHS 5million. They can now receive the benefits of their inheritance. They go to the registry to collect the probate. Plot twist: they are required to pay 3%, i.e.,GHS150,000.00, “court fee” to the court before they get the probate.

The irony is that, the deceased probably has more than this GHS 150,000 in his bank account, but the family need the probate or L/A before they can access the account. Yet, they cannot get the probate or L/A without the paying the money, which they need the probate or L/A to access. They are trapped in a catch 22 where they need the money and the probate at the same time, but they cannot access one without the other. This is the story of many mourning Ghanaians.

We have a full comprehensive explanation of the probate/administration process here – Letters of Administration/Probate in Ghana

Why Should a Court Fee Have No Upper Limit?

Administrative fees normally reflect the cost of a service. They are usually fixed on a grade or scale. All persons pay an equal fee or all persons within a class/grade pay the same fee. A percentage fee without a cap behaves differently. Would we accept 3% of a car’s value for a roadworthiness certificate? A percentage charge that lacks an upper limit amounts to an arbitrary financial barrier. That is the core concern here.

What Counts as a Tax or Fee in Ghana?

To understand why we think the court fee imposed on inheritance is a hidden tax, we must first understand what the law considers a tax or a fee.

A Tax

In Ghana, a tax is a compulsory financial charge that Parliament imposes on individuals or property. Article 174 of our Constitution makes this clear. No person must pay a tax unless Parliament has authorised it through an Act or a statutory instrument made under lawful delegation. A tax does not depend on consent. It is imposed by law and usually charged on a percentage of income, property or some gains.

A Fee

Ghana’s system also separates taxes from fees or service charges. A fee is a payment for a specific service, such as filing or registration. It is small and ought to relatively reflect the cost of the service provided. A tax does not operate this way. The rate of taxation is set by Parliament, it is paid into public revenue and supports general government functions. Unlike a fee, a tax does not necessarily promise a direct or immediate benefit to the person who pays it.

Where Does the Hidden Inheritance Tax Come From?

The court fees in general, i.e., the fees paid for filing/registering various documents at the Court are determined by the Rules of Court Committee. These are reviewed every few years to match the current economic environment. They are published as the Civil Proceedings (Fees and Allowances) Rules. The Committee is authorized by the constitution to set court fees, but it cannot impose taxes. This distinction is important.

When it comes to the fees for receiving Probate or L/A, instead of a fixed fee, like GHS 500, the committee set a rate 3% without an upper limit. That is where the issue arises. Because by setting an unlimited percentage rate instead of a fixed price, it looks and operates like a tax on inheritance.

The distinction helps us to understand the dilemma. The payment is imposed by law and levied as a percentage on some type of income, property or gain. It goes directly to support government revenue, but it is collected in exchange for a specific service to the payer.

Is Estate Duty/Court Fee Valid?

Critics might say that C.I. 55 does not create a “tax”. They would argue that the 3% levy is simply a court fee imposed under valid authority of Article 157(2) of the Constitution. In their view, probate is a specialised judicial service, and the fee reflects the administrative work required. They maintain that the Rules of Court Committee is constitutionally authorized to set such fees without passing through Parliament, and that a percentage-based structure does not automatically convert a fee into a tax. For these critics, the levy falls within established court practice, and any hardship it creates is a matter for administrative review rather than constitutional challenge.

There is good reasoning here and merit to the critique. The authority to set administrative fees is not unlimited. Administrative fees ought to be reasonable and relatively commensurate to the administrative service being provided. The committee could not for instance set GHS 1million as the cost of filing a lawsuit. An unlimited percentile metric is clearly unreasonable for what is to be a administrative fee. Imagine paying 3% of marital property value as the fee for a divorce certificate. The 3% figure is sufficient overreach to be unreasonable. Whether it is sufficiently an overreach to be ultra vires, is uncertain. The proportionality test and doctrine of reasonableness is where the legal arguments will settle. Maybe one day the supreme court will decide.

Ironically, the court fee on Probate or L/A fits all the classic features of an inheritance tax. It flows from the legal fact of death and the transfer of inheritance property. Both only arise because property is passing from a deceased person to their heirs. It is a percentage of the inheritance and compulsory by law. This is exactly how many countries operate their inheritance tax.

What About All the Other Percentage based Court Fees?

Critics have also said that there are other court fees that are percentage based. However, nobody complains about them. Are they also invalid?

This is also a meritorious question. However, it is important to place the probate fee in context. The court charges other percentage-based fees, such as 3% on sales under execution and 5% on money paid into or withdrawn from court. These fees can be frustrating. For example, a litigant may pay 5% to deposit funds and another 5% to withdraw the same money. However, these situations usually arise from litigation choices. Parties often have alternatives, including settlement or other out-of-court options. Probate is different. There is no alternative path to lawfully access a deceased person’s property. Probate or letters of administration are the only gateway. That compulsory nature makes the probate fee unique and justifies closer scrutiny.

The Real Burden on Families and Estates

Estate duty creates a real and often unexpected obstacle for many families. Most people enter the probate process believing they only need forms, affidavits, and a valuation all at a small administrative fee. They soon discover that they cannot secure probate or L/A without paying thousands of cedis in full. This requirement delays access to property, bank accounts, and rental income that grieving families may urgently need.

Many heirs struggle to raise the money. Some take loans just to unlock property that already legally belongs to them. Others will just take over the inheritance without a valid secure transfer of ownership, hoping to “manage” until they can pay the duty. This exposes them to disputes, eviction risks, and family conflict. Even criminal intermeddling. Lawyers also face pressure. Some clients ask them to understate the value of the estate to reduce the “court fee”. This creates ethical and legal risks, and it complicates the already slow probate process.

What Can Be Done? Short-Term Realities and Long-Term Reform

In the short term, families have very limited room to manoeuvre. The best approach is simple: plan for the duty, document property values early, and avoid attempts to undervalue the estate. Understating value may delay the process, attract penalties, or expose the estate to future disputes. Accurate valuation and timely payment remain the only practical options for families today.

The long term presents a different picture. While the court fee itself is valid, the administrative structure around it needs urgent reform. Parliament should review this area and reassert its authority under Article 174 by setting a clear, modern rate. A fixed ceiling like GHS 5,000, or 3% whichever is less, would reduce hardship while preserving revenue. So if the 3% of the inheritance is GHS 10,000 or more, then you pay GHS 5000, if the 3% is GHS 2,000, then you pay the GHS 2000.

Finally, reform should consider proportionality. Rising property values mean the duty now bites harder than originally intended. Parliament can modernise the framework to ensure the duty remains fair, predictable, and transparent.

These reforms would not abolish the court fee, but would transform it from a hidden tax into a clearer, more equitable part of Ghana’s succession system.

Parliament may even consider reintroducing a clear, transparent inheritance tax to replace the current ad valorem court fee.

Conclusion

The hidden inheritance tax may be lawful, but it operates as Ghana’s hidden inheritance tax. Understanding its impact prepares families for the probate process and highlights why thoughtful reform, rather than the status quo, is essential for fairness and clarity.