How Do You Value Items In A House For Probate?

If have lost a loved one and are dealing with a probate house sale, you may well be asking yourself “How do you value items in a house for probate?”. Let us help you with that question.

When you are dealing with an estate administration after someone’s death, you will need to value all of their assets, including their personal possessions and all of the contents of their home. This is one of the first steps in winding up their affairs.

Where they owned a property that needs to be sold, it will always be necessary to apply for a Grant of Probate or, if they did not leave a Will, a Grant of Letters of Administration. If the estate does not include a property, then a grant is not always necessary if the estate is small.

Our probate solicitors can advise you as to whether you will need to apply for a grant. We act for clients who have been appointed as executors or administrators to an estate, dealing with the administration and, where required, the property sale.

We know that it is likely to be a difficult time for you and you will find our team to be sympathetic and approachable. We have a high level of experience in dealing with estate administration, to include in respect of complex situations and high value estates.

We offer a free initial chat so that you can discuss your circumstances and ask us any questions you may have about the winding up process. You can ring us on 01482 300 200, email us at welcome@lockings.co.uk or fill in our Free Online Enquiry and we will call you back promptly. We represent local clients in Beverley, Hull and York as well as those from across East Yorkshire.

Valuing home contents for probate purposes

All of the deceased’s assets will need to be valued. As well as their property, savings and investments, this includes valuable items such as cars, furniture and jewellery and the contents of their home.

We know that dealing with your loved one’s personal possessions can be one of the hardest parts of the administration and that valuing these can be a difficult process emotionally. Some items will have sentimental value while others may also have a financial value which will need to be taken into account.

The deceased’s home contents insurance may list some items separately, which could give you an indication of their value.

The process of valuing house contents can seem overwhelming. We recommend making a list of items which could have value. You can then look for similar items that have been sold to find an estimated value.

If some items are expensive and harder to value, such as artwork, antiques, coin or stamp collections or jewellery, you can ask an expert to prepare a professional valuation for probate purposes.

If you do not want to value the home contents yourself, there are companies who will do this for you. A reputable company will have professional indemnity insurance.

Why do assets need to be valued after a death?

Finding out the value of the deceased’s estate after their death has to be carried out because this will establish whether it is necessary to obtain a grant and whether any Inheritance Tax is payable and, if so, how much.

As well as valuing the estate’s assets, the executor or administrator will also need to value the estate’s liabilities. This includes money owed in tax and to credit card companies as well as any outstanding mortgage debt.

Once you have the figures available, you can deduct the liabilities from the assets to give you a value for the net estate. This is the figure that will be used to calculate Inheritance Tax.

You will also need to take into account any substantial gifts that the deceased made over the last seven years of their life. If these exceeded their personal annual allowance of £3,000, with some exceptions, then Inheritance Tax may be payable on the gifts on a sliding scale, depending on how long ago they were made. A gift of value includes physical items as well as cash.

Inheritance Tax is a complex area and you may want to seek professional help in establishing whether it is payable and, if so, how much is due. There are a number of allowances available and these can reduce the amount owed substantially, so it is important to make sure that they are used.

Donating household and personal goods to charity

If the beneficiaries who have inherited the deceased’s house and personal goods wish to donate them to charity, there is a form that can be filled in when the Inheritance Tax forms are completed.

As well as the main Inheritance Tax form, there are also numerous schedules to be filled in, one for each type of asset. They include form IHT408, which relates to charity donations of goods.

If this form is completed, it will avoid the need to submit a formal instrument of variation to deduct a charity exemption in respect of the donations. The form is not to be used for goods left to charity under the terms of the deceased’s Will.

In filling in the form, you will need to briefly describe the goods, say how much they are valued at and name the charity to which they have been given. You will also need to include evidence that the charity has received the goods. Each beneficiary who inherited the goods will need to sign the form.

Form IHT407 – household and personal goods

There is also an Inheritance Tax schedule in respect of household and personal goods solely owned by the deceased that are not being donated to charity.

There are different sections to be filled in, namely:

• Items of jewellery valued at £1,500 or more
• Vehicles, boats and aircraft
• Antiques, works of art or collections
• Other household and personal goods not listed elsewhere on the form – this includes jewellery valued at less than £1,500, furniture and other domestic items. They do not need to be listed separately

If any of the household and personal items were listed separately on the deceased’s insurance policy, a copy of the policy should be sent with the form.

If any of the items have been professionally valued, a copy of the valuation should be included.

Forms IHT407 and IHT408 are part of the package of forms that will need to be sent to HM Revenue & Customs with the main Inheritance Tax form, IHT400.

If you would like us to assist you with the administration of the estate, we can complete all of the forms on your behalf and calculate how much, if any, Inheritance Tax is payable. For information about the costs involved in dealing with probate, see our probate pricing guide.

Contact our East Yorkshire and York area probate solicitors

If you are dealing with an estate and you would like to speak to one of our probate team, please feel contact us. We offer a free initial chat and we will be able to answer any preliminary questions that you may have. You can call us on 01482 300 200, email us at welcome@lockings.co.uk or fill in our Free Online Enquiry and we will call you back promptly. As well as helping local clients in Beverley, Hull and York, we also act for clients from across East Yorkshire.