Cheap professional property valuation for future tax purposes

booksurr

searching_for_truth wrote: »

The solicitor had said 'for tax purposes it's better to have a professional valuation'

expanding a bit on the scenario:

what is the status of the property that father is giving his son? Is it the fathers current main/only home and so exempt from CGT for the father? Who will live in it once son is the owner?

If not exempt, father will be immediately liable for CGT himself so the valuation at point of transfer will be needed for his CGT calculation now as well as later on for son's CGT eventual calculation

you may not be aware that after the property has sold, but before you submit your tax return, you can ask HMRC to check the valuations in your calculation using a Form CG 34 https://www.hmrc.gov.uk/forms/cg34.pdf. The advantage of that is by the time you submit your tax return you will know for certain the exact figure you will owe and so saves any last minute shocks if the CGT payable changes because your value is rejected. It does also of course give you the option of not getting a "professional" valuation at this time, using your "best guess" in your initial calculation then ask HMRC to check it (for free) and you will then have a definitive value given to you by HMRC - obviously at the risk you will have no idea how much you really owe until they do so and HMRC has no idea what the condition of the property was at the time of acquisition so they cannot value it exactly - ie you would be gambling!

g6jns_2

searching_for_truth wrote: »

Hi – Does anyone have recommendations for (cheap) professional property valuers? Something that will be recognised by HMRC. Estimates from comparables found from rightmove won’t do. I don’t know if this needs to be by chartered surveyors or there are other people who can do it too.

Background is this: Someone is gifting his property to his son and the solicitor has said it is wise to value the property now, because if the son in the future goes to the sell the property then CGT will kick in. Since the current owner has had the property for many years, it has appreciated in priced a lot. Solicitor if the property is valued now, then that can be used as evidence of the property’s current market value, so you won’t be overpaying on CGT when you sell it in the future.

The valuer who the solicitor has recommended have offered to do the valuation for £1,500. I want to know if it can be done cheaper.

Many thanks

£1,500 is ridiculous. Phone a few local RICS qualified surveyors and ask. They regularly do this in connection with mortgage applications for 10% of this amount or less.

searching_for_truth

The donor (father) does not live in the property (and won't be living). His residence is overseas. I'm 100% sure there are no CGT implications at this point of gifting. Donor is non-UK residence and non-UK domiciled person. The solicitor is charging £750 plus VAT for acting with regard to the transfer of the property.

Many thanks for all replies; I've learned good deal.

getmore4less

searching_for_truth wrote: »

The donor (father) does not live in the property (and won't be living). His residence is overseas. I'm 100% sure there are no CGT implications at this point of gifting. Donor is non-UK residence and non-UK domiciled person. The solicitor is charging £750 plus VAT for acting with regard to the transfer of the property.

Many thanks for all replies; I've learned good deal.

Not sure if there are any overseas implications.

Standard transfer is a simple form so unless there are other complications this seems very steep.

searching_for_truth

Yes standard transfer is simple and this is standard, but it's too late to change the solicitor.

If a RICS registered valuer says that he has already been to a similar property to your and that he doesn’t need to visit, is that Ok? Asking because out of people that I spoke to (from the RICS database), I got quotes ranging from £750 to £600 to £450. I asked the one who quoted £450 to carry out the valuation. After getting the address he emailed that he doesn’t need to visit and can send the valuation by post because he has already been to a neighbour having the same property plan. The property is in a gated development and there are 10 houses there, 3 of which are identical to the property in question. This surveyor correctly described the property in the email so must have been to one of the other 3 identical houses in the past. Question is, is this fine?

thanks

booksurr

searching_for_truth wrote: »

Question is, is this fine?

the surveyor will probably have some sort of professional indemnity clause trying to cover himself if his valuation is contested by HMRC but at the end of the day if father's property is identical to others in the development and, in your opinion, its condition does not add or detract from it generic value then I see nothing wrong in taking the £450 quote even if he never sets foot in it

99% of the valuation work will be a desk top exercise comparing sizes and prices, the fact a professional does it adds more credibility than you DIYing it, but the end result is the same....

the main difference is if you want the value to be adjusted for condition (eg poor condition >lower value> less inheritance tax to pay. Good condition>higher value>higher acquisition cost for CGT purposes>less taxable gain when sold) then it is very much in your interest to get someone who will physically inspect. If not, it's not going to make much difference if they do or don't set foot on the property

searching_for_truth

Thanks booksurr.