Referral fees for probate professionals: doing it properly

Discussions of referral fees in probate work tend to get stuck on the wrong question: are they allowed at all? The short answer is that they are. The statutory ban most people half-remember, introduced by the Legal Aid, Sentencing and Punishment of Offenders Act 2012, applies to personal injury claims — not to probate, estate administration, will-writing introductions or introductions to regulated financial advice. In those areas, disclosed and consented referral arrangements are permitted and long-established.

Once that is settled, the interesting question comes into view: not whether you may take a referral fee, but what doing it properly actually requires. That is a question about practice, not permission — about the record you keep, the consent you obtain, the destination you choose and the structure you work within. Getting those right is what separates a defensible arrangement from a vulnerable one.

The most common way probate professionals refer is also the least defensible: a name written on a compliment slip, a number passed on over the phone, a quiet word after a meeting. It feels harmless and informal, but it is precisely the version that leaves you exposed. Nothing is disclosed because nothing is recorded. If a client later complains, there is no evidence of what was said, why the recommendation was made, or whether the client agreed to anything.

Doing it properly inverts that. A structured referral produces a record as a matter of course — of the consent given, the disclosure made and the introduction itself. The paradox worth sitting with is that the formal, recorded route feels more exposing but is in fact far safer, while the casual favour feels safe but offers you nothing to stand on. Properly, in this context, begins with leaving a trail you would be content for anyone to examine.

Two obligations sit at the centre of every legitimate referral arrangement, and doing it properly means meeting both without relying on anyone's memory:

• Consent. The client should agree to be referred, deliberately and in their own time — not be signed up in a meeting or enrolled while their attention is elsewhere. Consent that the client gives themselves is consent you can evidence.
• Disclosure. Where you have a financial interest in a referral, the client must be told of the arrangement before or at the time it is made. Done properly, that disclosure is automatic and in writing, discharged the same way every time.

These are not hurdles set against your interests. They are what make a referral fee defensible. A client who chose the referral and was told of the arrangement has no grievance to raise, and you have a clean answer if anyone asks.

A referral is only as good as where it leads. Doing it properly means introductions go to vetted, regulated advice firms and vetted will and estate specialists — chosen for quality, not for whoever happens to be paying most in a given month. A fee earned by sending a client somewhere you would not send your own family is not an arrangement done properly, whatever the paperwork says.

It also means holding firmly to your role as introducer, not adviser. Where the referral is to financial advice, remember that advising on investments and pensions is a regulated activity reserved to FCA-authorised firms. You identify the need, obtain consent and make the introduction; the advice, and the responsibility for it, belong entirely to the authorised firm. Properly done, your part ends at the door — and staying on that side of the line is what keeps the whole arrangement safe.

All of this is achievable by hand, but doing it properly on every file, without slips, is far easier inside a structure built for the purpose. That is the model SmartPeer provides:

• Consent first — every referral begins with the client opting in online, in their own time, evidenced.
• Automatic disclosure — a disclosure letter is generated for every referral as standard.
• Vetted destinations — introductions go only to carefully selected, regulated firms and specialists.
• Live tracking — you can see the status of every referral, and commission statements reconcile against that record.
• Your client stays yours — SmartPeer never contacts your client except through the referral they consented to.

Membership is free with no monthly fees, and members keep 60 to 70 per cent of introducer fees. Doing referral fees properly was never about whether they were allowed. It is about consent, records, the right destination and staying an introducer — and a structure that delivers all four, every time. SmartPeer is free to explore and takes minutes to join.