You can’t hide from the Taxman

Even estates valued below the inheritance tax threshold are sometimes investigated by Her Majesty’s Revenue and Customs.

So it’s vital that a realistic valuation is sought for something like a house, which in many cases forms the bulk of the estate. The taxman insists on an open market valuation, which is described as the “price it might reasonably be expected to fetch if sold in the open market at that time” to an unconnected third party. Professional valuations are advised for estates close to the tax threshold.

Mortgage providers demand the outstanding loan is repaid following a death or they require a beneficiary to take over the monthly payments. You would need to write to the companies concerned if there were any life assurance, endowment or mortgage protection policies. If the plans are to sell the property, the mortgage will be repaid once the sale has been completed.

It’s best to seek professional advice regarding overseas properties as the rules differ from country to country.

Contact the Land Registry regarding a property with no outstanding mortgage that is to be transferred to a beneficiary. A form needs filling in and signing by the personal representatives and the beneficiary.

For expert help with the probate process, contact Heritage Will Writing on 02380 879243.