When a loved one passes away, it can be a difficult and emotional time for everyone involved. In addition to the grief, there are often many practical matters that need to be addressed, including the valuation of any property that the deceased owned. Property valuation for probate is an essential process that involves assessing the value of a property to determine the amount of inheritance tax owed. In this article, we will explore how property valuation for probate works and who should undertake the valuation.
What is Property Valuation for Probate?
Property valuation for probate is the process of determining the value of a deceased person’s property for inheritance tax purposes. Inheritance tax is a tax that is payable on the estate of a deceased person if the estate is valued above a certain threshold. The value of the estate is calculated by adding up the value of all the assets owned by the deceased person, including property, investments, and personal possessions.
In the case of property, the value of the property is the market value at the date of death. This is the price that the property would have fetched if it had been sold on the open market on the day the person died.
How Does Property Valuation for Probate Work?
When a person passes away, their executor or administrator is responsible for obtaining a valuation of the deceased person’s property for inheritance tax purposes. The valuation should be conducted by a qualified and experienced professional who is a member of a professional body such as the Royal Institution of Chartered Surveyors (RICS).
The valuer will consider various factors that could affect the property’s value, including its location, size, age, condition, and any planning restrictions or other factors that could impact its value. They will also look at comparable properties in the area to assess the market value of the property.
Once the valuation has been completed, the executor or administrator will use the value of the property to calculate the amount of inheritance tax owed. If the value of the estate is above the inheritance tax threshold, then tax will be payable on the excess amount.
Who Should Undertake the Valuation?
Property valuation for probate should be carried out by a qualified and experienced professional who is a member of a professional body such as the RICS. This is important to ensure that the valuation is accurate, reliable, and complies with all relevant regulations and standards.
Chartered Surveyors who are members of the RICS have undergone extensive training and have a deep understanding of property valuation. They are also bound by a strict code of conduct, which ensures that they provide impartial and independent advice.
In addition to providing accurate valuations, Chartered Surveyors can also offer valuable advice and guidance to executors or administrators on any issues or concerns that could impact the property’s value. This can include advice on any repairs or renovations that may be required to improve the property’s value.
Property valuation for probate is an essential process that can have significant implications for the estate of a deceased person. It is important to ensure that the valuation is accurate, reliable, and complies with all relevant regulations and standards. This is why it is essential to use a qualified and experienced professional, such as a Chartered Surveyor who is a member of a professional body such as the RICS. By using a professional valuer, executors or administrators can be confident that they are providing an accurate valuation that will help them to calculate the correct amount of inheritance tax owed.