More IHT or CGT

Cazzaloulou68

Ive filled in IHT400 forms and sent them off, am on day 14 of waiting for my code. It looks like the house is going to sell for more than the value submitted on the IHT400 forms. I said yes to using the house value on the schedule. Do i need to change anything when i fill in the online probate form? Or should i just send an amendment after probate has been obtained. There is a 10pc donation to charity which will change a little bit also. Any advise please

bobster2

The valuation of the house on IHT400 is meant to be the value on the date of death. A property may quite often increase in value after this before a sale - and then the estate simply needs to do a CGT return for the gain (the gain in value between the date of death and the date of sale).

You would only need to submit an amendment of the value used for probate purposes if you think the eventual sale provides evidence that your initial date of death valuation was not correct.

Cazzaloulou68

ok thank you for that-that makes sense now.

Keep_pedalling

How did you value the property and how long ago was the death? If the property was originally undervalued then more IHT is due, if you had a RICS valuation that should be more bullet proof against additional IHT. 

Cazzaloulou68

Keep_pedalling said:

How did you value the property and how long ago was the death? If the property was originally undervalued then more IHT is due, if you had a RICS valuation that should be more bullet proof against additional IHT. 

4 estate agents all said the same figure, death was in February (mother passed in January-brother 3 weeks later) all aware it was a probate sale. It’s not vastly different-maybe another 10-20k. We haven’t agreed a price yet, so when we get a final sale i may come back and ask for more advice. I’m still waiting for my code so i can apply for probate online, just wasn’t sure if i needed to show the difference in value then, or just complete CGT once it’s all gone through. There are only two beneficiaries myself and sibling

Keep_pedalling

Assuming we are talking about a high value property, that is a small difference and is unlikely to attract any additional IHT especially as the sale won’t go through until you have probate which is likely to be some months away.

For CGT selling costs can be deducted which will use most of that gain up.