Estate Valuation for Probate UK: Step-by-Step Guide

Overview

An estate valuation is a written account of everything the deceased owned and owed at the moment of death. The figure that results, often called the 'probate value', feeds into the application for a grant of probate (or letters of administration where there is no will) and into the inheritance tax position that must be declared to HMRC.

The valuation isn't a single number plucked from the air. It's a considered total made up of every asset the person held, minus the debts they left behind, with certain lifetime gifts sometimes added back in. Assets include the obvious things like property, savings and investments, but also pensions in some circumstances, personal possessions, vehicles, jointly held items, business interests and money owed to the deceased.

Debts cover outstanding bills, mortgages, loans, funeral costs and similar liabilities. Getting the figure right matters because under-reporting can trigger HMRC enquiries, penalties and personal liability for the executor, while over-reporting can mean the estate pays more tax than it needs to.

Key steps

1. Gather the paperwork. Start by pulling together everything you can find: bank statements, share certificates, premium bond records, ISAs, pension documents, property deeds, insurance policies, vehicle logbooks and any correspondence about debts. Writing to each institution to confirm balances as at the date of death is the standard approach, and most will issue a probate-specific letter on request.
2. Value the property. If the deceased owned a home or other land, get an open market valuation as at the date of death. For straightforward cases an estate agent's written figure may be enough, but where the property is valuable, unusual, or the estate is likely to hit the inheritance tax threshold, a RICS-qualified surveyor's report is generally safer because HMRC can challenge figures it considers too low.
3. List personal possessions and chattels. Household contents, jewellery, cars, art, collections and anything else of material worth should be assessed at what they'd fetch on the open market, not at replacement cost. Low-value household items can usually be grouped together with a reasonable estimate. Higher-value items such as antiques or fine art normally warrant a professional valuation.
4. Work out the debts and deductions. Add up everything the estate owes: outstanding credit card balances, utility arrears, the mortgage, personal loans, tax owed to HMRC up to the date of death, and reasonable funeral expenses. These come off the gross figure to produce the net estate value, which is the number that actually drives the inheritance tax calculation.
5. Submit the correct HMRC forms. Once you have a complete picture, the relevant inheritance tax account is filed with HMRC (the form needed depends on the size and nature of the estate). The probate application follows, using the figures you've declared. Keep every valuation, letter and calculation on file, as HMRC can review an estate for several years after the grant is issued.

Common questions