Valuing the contents of a flat

zygurat789

lincroft1710 wrote: »

OK furniture as well, but again doesn't say that it is fitted.

As John Pierpoint correctly states, items that are screwed down, i.e. fitted wardrobes, built in hobs, ovens, washing machines, dishwashers, fridges etc. are counted as part of the structure. Usually these would be mentined in the EA's property particulars.

Now if OP is buying some genuine antique Chippendale furniture amongst the contents or the odd Picasso on the walls, it may be enough to affect the stamp duty.

It was furniture, white goods etc. The etc is taken to include carpets, curtains and other stuff in situ ie it is fitted into its place in the flat. Someone has taken time and expended effort to put together acollection of household items so that they fit into place and (given that person's taste) match each other. The whole collection would, therefore, be much more valuable than the load of junk you could buy individually for the prices which have been suggested.

martinsurrey

zygurat789 wrote: »

It was furniture, white goods etc. The etc is taken to include carpets, curtains and other stuff in situ ie it is fitted into its place in the flat. Someone has taken time and expended effort to put together acollection of household items so that they fit into place and (given that person's taste) match each other. The whole collection would, therefore, be much more valuable than the load of junk you could buy individually for the prices which have been suggested.

doesnt matter.

Ignore the fact that you are buying the house, what would someone pay for the stuff at arms lengh (so ignoring the flat), this is how HMRC value things.

if you tried to sell the whole house worth of things as one item you would get almost nothing for it, as not many people are in the market for a whole house set up, so trying to argue differently is not going to work.

so the market value is the price somone would pay for each item or set of items,

carpets = almost nothing as they are cut to size, unles you can show otherwise

curtains = see above

electricals = almost nothing unless its top end and almost new and even then under 20% of retail, see ebay

etc etc...

zygurat789

martinsurrey wrote: »

doesnt matter.

Ignore the fact that you are buying the house, what would someone pay for the stuff at arms lengh (so ignoring the flat), this is how HMRC value things.

if you tried to sell the whole house worth of things as one item you would get almost nothing for it, as not many people are in the market for a whole house set up, so trying to argue differently is not going to work.

so the market value is the price somone would pay for each item or set of items,

carpets = almost nothing as they are cut to size, unles you can show otherwise

curtains = see above

electricals = almost nothing unless its top end and almost new and even then under 20% of retail, see ebay

etc etc...

And their authority for using this method

Except one of course

martinsurrey

http://www.hmrc.gov.uk/shareschemes/shares-valuation.htm

Deals with chattels as well as shares.

Section 118 of the Finance act 2003

http://www.legislation.gov.uk/ukpga/2003/14/section/118

leads to

Section 272 of the taxation of chargeable gains act 1992.

http://www.legislation.gov.uk/ukpga/1992/12/section/272/enacted

market value is the value the item can achieve on the open market, the open market for the asset is not the market for the asset and the flat in which it sits.


Can you demonstrate with evidence that the whole house worth of things is worth more than the sum of its parts, or best allocation of parts (such as a set of chairs sold as one)?

HMRC will accept anything reasonable, but you have to be able to show evidence, and they have plenty that shows second hand things are worth almost nothing, and they can, and do, chase people around the stamp duty land taxt hresholds.

lincroft1710

zygurat789 wrote: »

It was furniture, white goods etc. The etc is taken to include carpets, curtains and other stuff in situ ie it is fitted into its place in the flat.

This is only an assumption on your part, we don't know what the etc includes. Fitted carpets are usually considered as being fixtures

Someone has taken time and expended effort to put together acollection of household items so that they fit into place and (given that person's taste) match each other.

How do you know that anything matches? I've been in loads of houses with unmatched furniture.

The whole collection would, therefore, be much more valuable than the load of junk you could buy individually for the prices which have been suggested.

Er ... no

......................

Laurajo_2

Go in eBay and various second hand sites, see what people are paying for them. I know when we bought our house fully furnished with white goods, the value was about £600. Used white goods tend to have a low resale value.

John_Pierpoint

martinsurrey wrote: »

doesnt matter.

Ignore the fact that you are buying the house, what would someone pay for the stuff at arms lengh (so ignoring the flat), this is how HMRC value things.

.

Except when it is the other way round and they are trying to raise 40% Inheritancer tax (IHT) on the valuation - by the time most people die, the contents their house has a negative value in that the executor would need to pay to have the house cleared.

A relative of mine agreed £2,000 as the value of the contents of a student buy to let terraced house (think second hand and Ikea) but that was because the buyer was buying an up and running investment.

zygurat789

lincroft1710 wrote: »

......................

It was furniture, white goods etc. The etc is taken to include carpets, curtains and other stuff in situ ie it is fitted into its place in the flat.

This is only an assumption on your part, we don't know what the etc includes. Fitted carpets are usually considered as being fixtures

The assumption is stated and this is a general point not a specific one.

Someone has taken time and expended effort to put together acollection of household items so that they fit into place and (given that person's taste) match each other.

How do you know that anything matches? I've been in loads of houses with unmatched furniture.

That is your opinion, others may differ

The whole collection would, therefore, be much more valuable than the load of junk you could buy individually for the prices which have been suggested.

Er ... no

Definitely yes

zygurat789

martinsurrey wrote: »

http://www.hmrc.gov.uk/shareschemes/shares-valuation.htm

Deals with chattels as well as shares.

Section 118 of the Finance act 2003

http://www.legislation.gov.uk/ukpga/2003/14/section/118

leads to

Section 272 of the taxation of chargeable gains act 1992.

http://www.legislation.gov.uk/ukpga/1992/12/section/272/enacted

market value is the value the item can achieve on the open market, the open market for the asset is not the market for the asset and the flat in which it sits.


Can you demonstrate with evidence that the whole house worth of things is worth more than the sum of its parts, or best allocation of parts (such as a set of chairs sold as one)?

HMRC will accept anything reasonable, but you have to be able to show evidence, and they have plenty that shows second hand things are worth almost nothing, and they can, and do, chase people around the stamp duty land taxt hresholds.

From your references

1. The sale is hypothetical

2. The purchaser is a hypothetical, prudent and willing party to the transaction(unless considered a 'special purchaser') ie the purchaser of the flat.

3. For the purposes of the hypothetical sale, the vendor would divide the property to be valued into whatever natural lots would achieve the best overall price (this is the principle of 'prudent lotting')

4. The property is offered for sale on the open market by whichever method of sale will achieve the best price

5. The valuation should reflect the bid of any 'special purchaser' in the market (provided they are willing and able to purchase) ie the purchaser of the flat

martinsurrey

zygurat789 wrote: »

From your references

1. The sale is hypothetical

2. The purchaser is a hypothetical, prudent and willing party to the transaction(unless considered a 'special purchaser') ie the purchaser of the flat.

3. For the purposes of the hypothetical sale, the vendor would divide the property to be valued into whatever natural lots would achieve the best overall price (this is the principle of 'prudent lotting')

4. The property is offered for sale on the open market by whichever method of sale will achieve the best price

5. The valuation should reflect the bid of any 'special purchaser' in the market (provided they are willing and able to purchase) ie the purchaser of the flat

No, the entire purpose of valuing the contents is to separate the value of the contents from the value of the flat.

You are valuing the asset, with the asset being the contents.

Follow your own logic above, why would the purchaser pay any less than the full sales price for the contents, as it'll save them money as the house would then be free, no stamp duty at all, and if your thinking is right, that would follow all the rules as you interpret them, but that’s not the case, as that’s not how it works!

If you can logically answer the above you might be onto something as you’ll be able to save people £X,XXX by selling a teapot with a house and value the teapot at £500k saving stamp duty, but you cant.

Again, if you can show me whole houses of stuff being sold as one sale for more than expected, please do.