Death and Taxes are sometimes said to be two certainties in life!
Certainly, consequent upon death, Inheritance Tax issues can arise and often the most significant asset in any deceased’s Estate is the family home. Quantifying the value of the property in the Estate is included amongst the various responsibilities that Executors have to fulfil.
Property assets, such as dwellings, farmland, business premises and investment property, are required to be valued in accordance with the statutory definition of value for Inheritance Tax purposes, found at Section 160 of the Inheritance Tax Act 1984, where it is defined as:-
“The value at any time of any property shall for the purposes of this Act be the price which the property might reasonably be expected to fetch if sold in the open market at that time; but that price shall not be assumed to be reduced on the ground that the whole property is placed on the market at one and the same time”.
This definition is not exactly the same as the RICS Red Book definition of market value and the subtle differences can easily be overlooked by the unwary. Special considerations also apply when considering undivided shares in property and in providing valuations for Agricultural Property Relief purposes. The value required is date specific, the property being required to be valued as it stood at the date of death. A formal valuation is in our view preferable to and estate agents estimate of the likely sale price.
In addition to professional valuation advice and undertaking any subsequent negotiations with the District Valuer, we are also able to offer professional Estate Agency services where property within an Estate is to be sold. Depending on the circumstances and the type of property, sale by private treaty, public auction or informal/formal tender may be the most appropriate method of disposal and our experienced Agency Team led by Graham Carter and Rupert Geering can advise Executors as to how best to deal with the disposal of any particular property.
Our RICS Registered Valuer, Lloyd Smale FRICS, spent over 20 years with the District Valuer’s Office providing Probate/Inheritance Tax valuation advice to HMRC is well placed to provide the right advice and to undertake any negotiations which may be required with the District Valuer to arrive at an agreed figure.
If you feel our combined specialist Valuation and Estate Agency services can be of assistance to you, or someone you know, please do not hesitate to call us on 01363 773757.