Property probate value - tenant-in-common

[redchris111]

Hello

My sibling and I are joint executors for the wills of parents. My father is in a care home and my mother has recently been diagnosed as terminally ill and has a few months to live. They own a property outright (i.e no outstanding mortgage) as tenants-in-common rather than joint tenants.

When my mother dies my father (assuming he is still alive) will have his share of the property while my mother's share will be disposed of under the terms of the will. We will need to get my mother's estate valued and submitted to HMRC for the purposes of inheritance tax. So my question is do we include the full value of the property in the return to HMRC or 50% i.e my mother's share?

Thanks in advance

Chris

[AGoodman]

Property owned by H&W is generally considered to be taken at the arithmetic proportion of the whole (i.e. 50% of the total value).

The position is not 100% clear as there was a case in 2004 (Arkwright) that muddied the waters - suggesting you might be able to claim a discount as would be the case if the co-owners were not spouses) but HMRC are not going to accept any discount easily. In general, with transferable nil rate bands etc, it usually now makes sense to pass this share to the surviving spouse anyway.