DIY probate...

gillybean129

Hi
My mum passed away recently and left a will in which I am the executor/sole beneficiary.
She has 3 accounts with the Halifax and a property which at this point in time I don't want to sell.
Looking at the forms I can see though it's not straightforward I wan to do them myself and I think it's do-able.
I was wondering what to do about the house, do I have to pay someone to value it properly or do I estimate the market value myself?
I imagine her total asset to be around £200k well under the threshold.

G6JNS

gillybean129 wrote: »

Hi
My mum passed away recently and left a will in which I am the executor/sole beneficiary.
She has 3 accounts with the Halifax and a property which at this point in time I don't want to sell.
Looking at the forms I can see though it's not straightforward I wan to do them myself and I think it's do-able.
I was wondering what to do about the house, do I have to pay someone to value it properly or do I estimate the market value myself?
I imagine her total asset to be around £200k well under the threshold.

Sorry for your loss. The thing to consider is that if you sell it later the probate value will be the starting value to determine any capital gain so a reasonably accurate figure is worthwhile but a sensible estimate will do if you are confident it is about right. Read the stickies on here as DIY is quite easy. Just time consuming and it can be hard because you are still grieving. Plenty of help here if you need it.

joerugby

https://www.gov.uk/valuing-estate-of-someone-who-died/assets

You should use a professional valuer - eg an estate agent or chartered surveyor - for land, buildings, household goods and personal belongings worth more than £500. You can estimate the value of smaller items.

G6JNS

joerugby wrote: »

https://www.gov.uk/valuing-estate-of-someone-who-died/assets

This is simply not necessary! There are plenty of free sources to do the job. As the estate is way below the IHT threshold it would be a waste of money.

joerugby

G6JNS wrote: »

This is simply not necessary! There are plenty of free sources to do the job. As the estate is way below the IHT threshold it would be a waste of money.

I've quoted the official HM Government guidance.

I'd suggest asking a couple of estate agents for costs.

I'd also suggest consideration of the circumstances when a written valuation might prove useful, e.g. as the base for any future cgt calculation.

The OP can then decide for themselves.

getmore4less

With any valuation it is a guess.

Estate agents will give valuations for free and you can get comparison prices from recently sold and a few after DOD if they exist to back up your guess.

Some EA/valuers will do a probate valuation(written) for free or very little on the back of getting business later.
(not all EA are professional valuers)
One consideration is if you plan to keep long-term and live in the place CGT can be less of a problem but worth understanding how CGT works if it will be empty/rented.

gillybean129

Thank you.....what are the implications of CGT if I rent? It's starting to look complicated!

If I sell and gain then wouldn't I still be under the CGT threshold, even if I add my earning it won't be anywhere near it?

G6JNS

gillybean129 wrote: »

Thank you.....what are the implications of CGT if I rent? It's starting to look complicated!

If I sell and gain then wouldn't I still be under the CGT threshold, even if I add my earning it won't be anywhere near it?

CGT and IHT are two separate taxes. CGT is payable when you dispose of an asset fro more than it cost you or in the case on ineritance the probate value. If you live in the property there is no CGT. If you are going to rent then you will have to pay tax on the rent less certain expenses. At this stage the first priority is to ensure the property is secure and insured. There is plenty of information on the various stickies on the forums.

gillybean129

Ah yes CGT, I've just looked at it, I suppose it is if I sell the house later then I pay it on the difference on the value that has increased. I am thinking of giving it to my daughter so I will take it a step at a time...

BobQ

gillybean129 wrote: »

Ah yes CGT, I've just looked at it, I suppose it is if I sell the house later then I pay it on the difference on the value that has increased. I am thinking of giving it to my daughter so I will take it a step at a time...

CGT is charged on the difference between the acquisition cost and the sale cost, less the expenses of selling it. There is CGT exemption band (about £12K as I recall) and the tax levied depends on your income tax rate.

If you decide to let the property commercially, it is effectively running a business. So you will pay income tax on the rental income at your marginal rate of income tax. But you only pay tax on the net rental income as you can deduct some expenses from the gross income (eg maintenance costs, letting agents fees, property insurance).

Remember if you give it to your daughter and she does not live in the house she will be liable for CGT.