Estate valuation. How to value a house and other assets for probate
Applying for probate can be a Stressfull and Exhausting task, but our specialists are here to make it feel simple. In this guide, you’ll find everything you need to know about going through probate and dealing with someone’s estate.
- PART 18
Estate valuation. How to value a house and other assets for probate
To value a house for probate, it’s usually best to hire an RICS property surveyor – especially if the estate’s value is close to or above the inheritance tax threshold. For bank accounts and other assets, you can usually contact the organisations directly.
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Who is responsible for doing an estate valuation?
The executor of the will or administrator of the estate is usually responsible for doing an estate valuation. This includes calculating the value of the house and any other properties owned by the person who died. You’ll also need to work out the value of any bank accounts, savings, pensions, life insurance policies, stocks and shares, debts and even gifts given in the last seven years.
If you’re the executor or administrator and feel like the estate is too complex to deal with yourself, you could pay a professional to handle this for you. This is called a Complete Probate or estate administration service, and also includes getting the grant of probate.
If you would like a quote for our fixed-price Probate Full Administration please give our probate specialists a call on 0808 188 9008
How to value a house for probate
There are a number of ways to value a house for probate. Some people compare the cost of similar houses on the street or in surrounding neighbourhoods, others go straight to a property surveyor or estate agents for a more accurate valuation.
The best option for you will depend on three key factors:
The approximate value of the estate
The inheritance tax allowance of the person who died
If the estate is being left to a spouse, civil partner or qualifying charity
If the approximate value of the estate (including the house) is close to or above the inheritance tax threshold, it’s recommended that you get a property valuation from an RICS property surveyor. This can help to prove the value of the house to HMRC, and you can also refer HMRC to the surveyor if they dispute the valuation provided on the probate and tax forms.
The date the property is sold may also impact HMRC’s view on the valuation. If, for example, the house is sold soon after death for significantly more than the valuation you receive today, HMRC may insist on using the actual value it was sold for.
You can find out more about inheritance tax thresholds here.
Estimate the property value yourself
If you have a rough idea of the house’s value and know it won’t take the estate over or close to the inheritance tax threshold, you could estimate the property’s value yourself. You can do this by:
Searching for the property on Zoopla for an estimate
Searching for similar properties in the local area to work out how much it could sell for
Get a valuation from your local estate agent
If you’re planning on selling the house and want a more accurate estimate, you could get a free house valuation from your local estate agents.
Remember, if the house value is likely to take the estate close to or above the inheritance tax threshold, it’s recommended that you get three valuations to help prove the house’s value to HMRC – you could then take an average from these valuations.
If there’s quite a lot of variation between each valuation, you may be better off using an RICS property surveyor to get a more accurate value.
Get a valuation from an RICS property surveyor
If you feel like HMRC could challenge your property valuation and want to build the strongest case possible, it’s recommended that you get a professional valuation from an RICS property surveyor.
This is the only option that you would need to pay for, so it’s only worthwhile if the estate’s value is close to or above the inheritance tax threshold.
Regardless of which method you choose, HMRC may still decide to challenge the valuation, especially if they think the house’s value is being underestimated. They may also dispute your valuation if they see that the house has sold (or is being sold) for significantly more.
If you would like help valuing a property for probate, please call our probate specialists on 020 4538 2378.
How to value a jointly owned property for probate
You can value a jointly-owned property by estimating the value yourself or getting a valuation from an estate agent or RICS property surveyor. Then, for the probate and tax forms, you simply need to include the share owned by the person who died.
Here are a couple of examples:
A property is owned as joint tenants by a married couple, Paul and Susan. When Paul dies, Susan automatically inherits the whole property. The house is then valued at £300,000, so Pauls’s share is written as £150,000 on the probate and tax forms (50% of £300,000).
A property is owned as tenants in common by a couple in a civil partnership, Gareth and Matt. Gareth owns 80% of the property and Matt owns 20%. When Gareth dies, the house is valued at £400,000, so his share is written on the probate and tax forms as £320,000 (80% of £400,000).
How long does it take to value a house for probate?
A professional property valuation by an RICS surveyor can take anywhere between 45 minutes and a couple of hours. The surveyor will then go away and produce a comprehensive report, which may take up to two weeks. If you choose to use an estate agent instead, the process is usually slightly quicker. However, it’s important to remember that an estate agent’s valuation won’t be as accurate and is more likely to be disputed by HMRC.
How to value bank accounts, savings and other assets
You can usually work out the value of other assets in the estate by contacting the financial organisations directly. However, before you can do this, it’s important to build up a list of assets.
If your loved one made a will, they may have included an inventory of their estate. This can really help to speed up the probate process, as you know you’re not missing any of their assets. If you can’t find an inventory anywhere, you can search through their paperwork to make a list of their assets.
This could include:
Bank accounts
Savings accounts
Pensions
Investments
Stocks and shares
ISAs
Life insurance
Possessions
Business
Foreign assets
Trust assets
Debts
Gifts given in the last seven years
Once you’ve put together a list of assets, you can contact each company one by one to find out the value of each asset or debt.
If you have any questions about valuing assets for probate, or if you would prefer us to do this on your behalf, please call our probate specialists on 0808 188 9008
How to get probate after valuing the estate
Once you’ve calculated the value of the house and other assets and debts in the estate, you’re ready to apply for probate.
At Farewill, we offer a fixed-price probate service for as little as £595. This takes the stress of probate and tax forms off your hands so you’re free to focus on what really matters.
If you would like to find out more about our probate service, or if you’re ready to get started today, please give us a call on 0808 188 9008
Summary
The executor or administrator of the estate is usually responsible for valuing the estate and applying for probate.
To value a house, you can make an estimate by searching for the price of similar properties online or getting estate agents to value it. But if the estate’s value is close to or over the inheritance tax threshold, you may be better off getting a professional valuation from an RICS property surveyor.
You can track down other assets by checking the will for an inventory or searching through bank statements and other paperwork. And, if the person who died had a financial adviser or accountant, you can make enquiries with them too. It can also be helpful to collect up their post to see which financial companies they receive regular statements from. You can then contact each organisation directly to find out the value of each asset.
If you need help getting probate or valuing someone’s estate, you can speak to our specialists by calling 0808 188 9008
You can call free on 0808 188 9008 or you can call us on 0207 965 7568 for the London area (Local charges apply) or alternatively call 01380 718199 (Local charges apply).
You can also fax us on 0844 884 8509. at 11p and up per minute from a fax machine.
Correct as of 1-1-2021
Please note: do not call the fax number from a mobile phone as you will be charged 50p per minute and you will not be able to speak to anyone.
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