IHT RICS Over Valuation

[keepgoing99]

Hi,

I had a property valued by the RICS valuer at £950,000 when my father passed away just over a year ago. The market hasn't moved in this area and flats in the same building have sold for £900,000 or less and mine is more dated for sure than theirs and in need of more work. It's looking like an over valuation of £50000-£70,000 roughly so the IHT isn't insignificant.

I'm aware that if i then sold it it would qualify as a capital gains loss/any future capital gain in the future would be mitigated by the over valuation today. However, this is actually my "first home" as i was a renter before and i'm now living in it, thus i wouldn't face any capital gains anyway on any sale (i'm not going to sell it for years, if ever).

Part of the problem is that my only 1/3rd of the flats are my size (the smallest) and none of this size had been sold recently. Thus the surveyor from his report worked from the larger flats valuations and estimated what something this size would be worth based on that: subsequent data which is more comparable (ie one with the exact same floor plan) shows my flat has definitely been over valued. No one would pay £950,000 for this, period.

Is there anything I can actually do about this or do I just have to stomach it?

[iwmtaxadvisor]

I had a quick look round, and there is a 'Corrective Account' here
https://assets.publishing.service.gov.uk/government/uploads/system/uploads/attachment_data/file/371960/c4_2.pdf
but I have not researched in what circumstances HMRC will accept an amendment to the IHT assessment which I imagine has not yet become final.
If it were me, acting on my own, I would obtain a second and hopefully less valuation and then put in this form asap and see what HMRC say.
If I were advising I would put a lot more time on the process i.e. just when HMRC are obliged to take note of 'mistakes' and i say this so you know I think this is important and would normally take a CTA two or three hours. Much depends on the details.

[maths]

Inevitably HMRC's valuations tend to be on the higher rather than lower side.

Your best bet is to ask an RICS surveyor to value the property at then date of death telling him the purposes is to enable you to complete the IHT wrt to father's death estate.

Without any contra evidence of a high quality you will be stuck with the HMNRC figure.

Corrective account here is not really relevant.

[pawncob]

As Maths says, get a valuer who is prepared to fight your corner, and defend his valuation with HMRC.

[bd6759]

Inevitably HMRC's valuations tend to be on the higher rather than lower side.

Your best bet is to ask an RICS surveyor to value the property at then date of death telling him the purposes is to enable you to complete the IHT wrt to father's death estate.

Without any contra evidence of a high quality you will be stuck with the HMNRC figure.

Corrective account here is not really relevant.

This wasn’t HMRCs value. The valuation was given by a RICS surveyor instructed by the OP to value his father’s estate. IHT has been paid on that value. As the Surveyor was working for the OP, it is more likely to be at the lower end, not the higher end.

The OP’s comments re CGT are irrelevant and a red herring because he hasn’t sold the property. He is living in it.

There is nothing to prevent OP getting a second opinion and applying to have probate and IHT amended. But that’s not really a DIY process.