How to value an estate for Inheritance Tax and report its value
If Inheritance Tax is due or full details are needed
You must report the value of the estate to HM Revenue and Customs (HMRC) by completing form IHT400.
You must submit the form within 12 months of the person dying.
You may have to pay a penalty if you miss the deadline.
Getting accurate valuations
You’ll need to give accurate valuations when you complete the form.
You can get any property or land valued by an estate agent or chartered surveyor.
You can also get a professional valuation for anything worth over £1,500.
You can estimate the value of cheaper assets, such as electrical items and ordinary household goods.
For things like cars, jewellery, and paintings, work out how much you would have got if you’d sold them. You can search for similar items on online marketplaces for this.
Report the value of the estate by completing form IHT400
You need to download and complete form IHT400. Send it to the address on the form.
When completing and submitting the form, make sure you:
- answer all relevant questions
- complete and send any relevant additional pages (known as ‘schedules’)
- only send a copy of the will (if there is one) and include copies of any official alterations (known as ‘codicils’) - do not send any originals
You can read guidance on how to complete form IHT400.
If you need help completing the form
Contact HMRC’s Inheritance Tax helpline for help with completing form IHT400.
Once you’ve submitted the form
HMRC will work out how much tax is due, as well as any interest you may need to pay. They will write to you with their calculations and tell you what happens next.
When HMRC may carry out further checks
Occasionally, HMRC may carry out further checks on the information you’ve provided (known as a compliance check).
This may include the Valuation Office Agency (VOA) or Shares and Asset Valuation team (SAV) checking any valuations provided.
If you’ve not heard from HMRC 14 weeks after submitting your IHT400 form, no further checks will be carried out.
If your form is selected for further checks
HMRC will write to you if they’re carrying out further checks.
HMRC will then phone to explain what they are checking. They’ll do this within 8 weeks of writing to you.
If they ask you for more information, they’ll agree when you need to provide it.
If the VOA or SAV need to check valuations
The VOA or SAV may contact you about the valuations you’ve provided.
If they decide that any of the assets are worth more than the valuations provided, HMRC will send you new calculations once the values have been agreed.
Telling HMRC about changes to the value of an estate
You need to tell HMRC about any changes once the values are final or 18 months after the person died, whichever is sooner.
If the values are not final or it’s less than 18 months since the person died, you only need to tell HMRC if:
- there’s a change in value to land, buildings or unlisted shares
- you’ve sold land or shares at a loss
- you’ve sold any assets on which you were paying tax by instalments
- the value of the estate increases or decreases by more than £50,000 before any exemptions or reliefs
- the person who died made a gift with reservation or was the ‘beneficiary’ of a trust when they died
- further checks are being carried out on the estate
How to tell HMRC about any changes
You’ll need to complete a corrective account form or for estates in Scotland a corrective inventory and account (Scotland). Once completed, send to the address on the form.
You’ll need to calculate any additional tax due and make a payment on account to stop any interest from accruing. HMRC will send final calculations once they have all the details.
Claiming relief on property or shares sold at a loss
To claim relief on land or buildings sold at a loss within four years of the date of death, complete form IHT38.
To claim relief on shares sold at a loss within 12 months of the date of death, complete form IHT35
Once completed, send to the address on the form.
Paying Inheritance Tax
You must pay Inheritance Tax by the end of the sixth month after the person died. For example, if the person died in January, you must pay Inheritance Tax by 31 July.
You can pay in yearly instalments on certain things that may take time to sell, such as a house.
You’ll need to get an Inheritance Tax reference number from HM Revenue and Customs (HMRC) at least 3 weeks before paying any tax.
When you can apply for probate
HMRC will send you a unique code confirming you’ve paid enough tax. You’ll need this code in order to apply for probate in England and Wales or confirmation in Scotland.
If you’re applying for probate in Northern Ireland, HMRC will fill in their part of Schedule IHT421 and send it back to you. You’ll need this in order to apply for probate.
HMRC will usually send the unique code or IHT421 within 20 working days of receiving your IHT400 form or Inheritance Tax payment, whichever is later.