Inheritance Tax Valuations

You don’t need more than one valuation. However, getting mother than one valuation means you’ll have more evidence regarding your property’s value when you send it off to the District Valuer.

A valuation survey for inheritance tax purposes takes around 1 hour to conduct.

A property valuation for inheritance tax purposes costs £475 inc. You can also get in touch or use our instant quote form to get a price quote for your property valuation.

If a property increases in value from when you inherited the property, to when you come to sell it, you will have to pay capital gains tax on the increase if it isn’t your main place of residence. For more information, visit our page on valuations for capital gains tax purposes.

You must pay inheritance tax by the end of the sixth month period after a person's death. So, you should get an estate valuation done well in advance of the final deadline in order to give yourself time to pay your inheritance tax bill.

For most people, sorting out inheritance tax and subsequent probate (the power to divide up a person’s possessions according to the will of the deceased) often comes at a very hard and emotional time. When people are grieving, mistakes can occur – genuine or otherwise. There is also pressure to get a valuation completed early because you are only given a grant of probate once inheritance tax has been sorted and the estate’s true value known, i.e. the price “the property might reasonably be expected to fetch if sold in the open market at that time” (1984 Inheritance Tax Act). Despite it being an expense, the cost of hiring a sympathetic yet professional surveyor, with sound local knowledge of property values, such as Aston James Associates, can be dwarfed by the extra tax and potential fines looming if HMRC considers your valuation too low.

The buck stops with you, the executor/s (ie. the person or people chosen by the deceased to carry out their wishes as laid down in their will). Inheritance tax law states that you need to submit an accurate market value of a person’s property at the date of death for “inheritance tax purposes” – not probate. At Aston James Associates, we would calculate that by adding up all your relative’s or friend’s assets and then taking away any debts, bills and funeral expenses that have to be paid off first. While inheritance tax is normally paid on an estate (which comprises the whole of a person’s possessions), it can also be paid out on gifts and trusts that have previously been given and set up by the individual. The bottom line is that any single person’s estate worth over £325,000 is taxed at 40% (or 36% on charitable donations) with one big exception – the threshold can jump to a maximum of £650,000 if all the assets of the deceased are passed on to their spouse or civil partner either during their lifetime or at time of death. By choosing Aston James Associates as your surveyor, we’ll liaise with the district valuer and Revenue and Customs to ensure accurate and efficient completion of what is a tough process.

Remember as an executor you will be liable for any potential fines, so it pays to do the following:

• Ensure the surveyor you choose to do an asset valuation has signed up to the mandatory registration scheme run by the Royal Institute of Chartered Surveyors
• Collaborate closely with your surveyor to ensure a valuation as accurate as possible but question any of their judgments that are based on assumptions
• Don’t risk “quick fix" valuations based on the old system of entering the average of three market estimations by estate agents. It no longer cuts much ice with HMRC, which strongly urges the use of professionals

Inheritance Tax is payable by different people under different circumstances. Typically, the executor or personal representative pays it using funds from the deceased’s estate. The trustees are usually responsible for paying Inheritance Tax on assets in, or transferred into, a trust. Sometimes people who have received gifts, or who inherit from the deceased, have to pay Inheritance Tax – but this is not common.

Since October 2007, married couples and registered civil partners can effectively increase the threshold on their estate when the second partner dies – to as much as £650,000 in 2012-13. Their executors or personal representatives must transfer the first spouse or civil partner’s unused Inheritance Tax threshold or ‘nil rate band’ to the second spouse or civil partner when they die.

You have to fill out an Inheritance Tax form as part of the probate process (or confirmation in Scotland) even if no Property Inheritance Tax is due. Different forms are used depending on where the deceased lived, and whether there is any Inheritance Tax to pay. You must pay some or all of any Inheritance Tax due before you can get a grant of probate (or confirmation). More detailed information can be obtained from the HM Revenue & Customs website or by contacting The Law Society.