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HMRC internal manual

Inheritance Tax Manual

From
HM Revenue & Customs
Updated
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Transfers on death: what is the value transferred on death?

The starting point is the value of all the property that makes up the person’s estate (IHTM04029) less the value of deductible liabilities (IHTM28010). The rules about the valuation of property (IHTM09701) and the deduction of liabilities (IHTM28002) are covered in other sections, but there are some special rules that effect the value of the estate on death. These are that

  • in valuing property in the death estate, the estate has to be considered in it’s entirety, so items of property may be taken together (IHTM04045) even though they may be held under separate titles,
  • although the deemed transfer takes place immediately before the death, certain changes in value caused by the death (IHTM04046) are taken into account,
  • dividing the property into natural lots; (IHTM09701) or valuing two or more items of property as a single unit, (IHTM09701) may produce a higher value,
  • the value of certain categories of property is left out of the account, (IHTM04331)
  • there are special rules for deducting certain liabilities on death such as funeral expenses (IHTM10371) and expenses incurred abroad (IHTM27050).