1. Overview

An ‘estate’ is a person’s money, property and possessions.

When someone dies, valuing their estate is one of the first things to do as part of the probate process of sorting out their affairs. The process is different in Scotland and is known as ‘confirmation’.

You need to find out the value of the estate to see if Inheritance Tax is due.

Inheritance Tax is due at 40% on anything above the threshold of £325,000. If 10% of the estate is donated to charity this is reduced to 36%.

An estate is made up of anything that has a value (an ‘asset’), like:

  • money in a bank or building society account
  • property and land
  • personal belongings - like jewellery
  • furniture
  • cars
  • shares
  • trusts
  • pensions that include a ‘lump sum’ payment on death
  • a payout from a life insurance policy

If the person gave away any assets before they died - called ‘gifts’ - you may have to include them in your valuation too, as well as any debts they had.

The basic steps to valuing an estate

  1. Work out the total value of the assets and gifts. You should use a professional valuer for anything that’s worth more than £500.

  2. Deduct any debts that the person owed.

  3. Record your valuation - include any paperwork you used to get valuations.

  4. Decide if Inheritance Tax is due and find out which forms you need to complete (this depends on where the person lived and if tax is due).

If the person’s affairs are complicated, a solicitor can help you value the estate and sort out the tax.

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