RICS Red Book valuations for probate, inheritance tax and capital gains tax purposes.
When someone dies, HMRC requires the value of their estate — including any property — to be established for inheritance tax purposes. Section 160 of the Inheritance Tax Act 1984 defines this as the open market value of the property at the date of death.
HMRC expects this figure to be supported by professional evidence. An independent RICS Red Book valuation, prepared by a Registered Valuer with comparable sales evidence from around the date of death, is the standard HMRC and the District Valuer recognise.
The probate valuation determines whether inheritance tax is payable, how much, and also sets the “base cost” for any future capital gains tax calculation when the property is later sold by the estate or beneficiaries.
Capital gains tax is charged on the increase in a property’s value between acquisition and disposal. When the acquisition value is unknown or needs to be established at a specific historic date — for example the date a property was inherited, gifted, or 31 March 1982 for long-held assets — a retrospective (backdated) valuation is required.
Our valuers research the market as it stood at the relevant date, using historic comparable sales, land registry records and condition evidence, to establish the base cost from which your taxable gain is calculated. The valuation date is determined by the disposal event — your accountant or solicitor will confirm the date HMRC requires.