House contents valuation for probate are required when making an application. Before you complete the inheritance tax forms call us to assist. We can provide a fast efficient service.
Before a Grant of Probate or Letters of Administration can be issued you will need to complete the required Probate forms. You`ll need to value the deceased`s belongings no matter whether the estate is classed as an excepted or not. If the estate is liable for inheritance tax, this will involve an itemised account and professional valuations of any items worth more than £500.
Household and Personal Goods Defined
Household and personal goods or chattels are simply the personal belongings of the deceased. This includes items such as furniture, antiques, art, electronic equipment, jewellery, vehicles and collectibles. It does not include money, property, fixtures and fittings, investments or business assets. For inheritance tax purposes it includes any belongings that were gifted within the last 7 years.
Open Market Value
House contents valuation concern the open market value of goods and belongings only. This basically means a realistic price on the open market at the time of death. For example where an insurance valuation would be the cost to replace the item new, the OMV would be its value if it were to be sold at an auction or through a local newspaper.
Do I Need to Use a Professional?
It is not a requirement to obtain professional valuations for household or personal items; an estimate will suffice. However, you may be required to do so for individual items that are estimated to be worth in excess of £500. It is fairly straight-forward to value some items, for example, a second hand car can easily be valued based on publicly available information. On the other hand, other possessions, such as a rare gold broach or antique sideboard can be a lot more difficult.
When it comes to electrical items, audio-visual equipment etc. and furniture, people have a tendency to over-value, not realising how little they`d actually be worth on the open market. This is why using the services of a professional is preferable to avoid unnecessary tax liabilities. Also, HMRC are much less likely to query a professional valuation, preventing further delays in the process.
Relevant Probate Forms
IHT205 - For expected estates, you are required to provide an overall value in box 11.2.
IHT404 - This form requires itemisation and valuation of chattels of which the deceased owned jointly.
IHT407 - This section requires itemisation and values of chattels of which the deceased was the sole owner. This includes jewellery worth more than £500, vehicles (cars, boats, and caravans), antiques, works of art or collections. The remainder of the deceased belongings; jewellery valued at less than £500, furniture and other domestic items, does not need to be itemised, an estimated total sum must be provided.
IHT408 - This is for household and personal goods donated to charity which are exempt.
Some companies specialise in house clearance for administrators and executors. These services can include a thorough house contents valuation, the sale or disposal of unwanted items, transportation, cleaning and repairs ready for re-sale. It is highly recommended to use a clearance company to ensure accurate valuations and less chance of queries by HMRC. You`ll receive a detailed valuation report for your inheritance tax return and can save yourself the time and stress of obtaining multiple valuations.