Inheritance Tax – house price valuations and coronavirus
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simon_clarke
Posts: 1 Newbie
Hi everyone. First post here. My mum has just passed away from the coronavirus – and I've realised there may be problems with her estate because of the effects of the pandemic and the lockdown strategy. Has anyone seen any advice about this? For example, I have to start paying the inheritance tax within 6 months – but how can I get an accurate valuation of her house [the main asset] when the housing market is frozen? I am worried that I will be forced to pay tax based on a pre-lockdown valuation and then house prices will go down significantly for a long period.
Not sure if this is the right section to post in – thanks for any response...
Not sure if this is the right section to post in – thanks for any response...
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You'll have to get a RICS valuation which should, presumably, take into account the current situation,
#2 Saving for Christmas 2024 - £1 a day challenge. £131 of £3660 -
Are you sure IHT will be payable ? 500k relief usually available, and double that where relief is passed from one spouse to the next.0
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Condolences on your loss.
You need the value at the date of death.
https://www.pettyson.co.uk/about-us/our-blog/540-probate-house-valuation
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I am sorry for your loss. If you sell an inherited house for less than the probate valuation I believe it is possible to reclaim overpaid tax.
But a banker, engaged at enormous expense,Had the whole of their cash in his care.
Lewis Carroll0 -
Have you taken into account her nil rate band and residence NRB? IHT won’t kick in unless her estate exceeds £475k and could be twice that if she was a widow.
If IHT is due HMRC allow it to be payed in instalments over 10 years where property is involved. Getting an accurate valuation is going to be difficult at the moment, but you can submit an estimated value and adjust it if the eventual sale price is substantially different.0 -
My wife and I sold our property last year and currently in rental accommodation but now in the process of buying a new property, which has obviously ground to a halt. This means that our current estate is potentially over the IHT threshold as we are unable exchange/complete on the new property. IF we should both die would this mean the Residence NIL band is not availble on our estate thereby our direct descendants could be left with higher IHT liability or is there any relief due COVID ?
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JGB1955 said:You'll have to get a RICS valuation which should, presumably, take into account the current situation,0
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grundy47 said:My wife and I sold our property last year and currently in rental accommodation but now in the process of buying a new property, which has obviously ground to a halt. This means that our current estate is potentially over the IHT threshold as we are unable exchange/complete on the new property. IF we should both die would this mean the Residence NIL band is not availble on our estate thereby our direct descendants could be left with higher IHT liability or is there any relief due COVID ?0
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My wife and I sold our property last year and currently in rental accommodation
https://www.telegraph.co.uk/tax/inheritance/does-new-inheritance-tax-perk-work/
https://www.accountancydaily.co/hmrc-guidance-complicated-iht-home-downsizing-rules
It is possible to protect the RNRB if you sell your family home to move to a smaller property, or into rented accommodation or a nursing home.
Essentially, if you have sold a property after July 8 2015, you should calculate what percentage of the RNRB could have been claimed had you died after April 2017 and still been living there. This additional allowance can still be used to offset inheritance tax against other assets on death.
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