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To find out if there’s Inheritance Tax to pay, you need to value the money, property and possessions (‘estate’) of the person who’s died.

You must do this before applying for probate (if you need it).

You need to complete 3 main tasks when you value the estate.

1. Identify the person’s assets and debts such as savings, investments, mortgages and loans.

2. Estimate the estate’s value. This will affect how you report the value, and the deadlines for reporting and paying any Inheritance Tax. Most estates are not taxed.

3. Report the value of the estate - if and how you do this depends on whether you need to send full details of the estate and its value.

How long it takes

Valuing an estate can take several months, but it can take longer if it’s a big or complicated estate (for example if it involves trusts or there’s tax to pay).

Deadlines

If the estate owes Inheritance Tax, you must report its value within one year using form IHT400. You cannot apply for probate until you have done this.

You’ll normally have to start paying Inheritance Tax before probate is granted.

Getting help

You can hire a professional (for example a solicitor) to help with some or all of the tasks involved with valuing an estate.

Money Helper has guidance on . Law Donut has advice on .

Before you can value the money, property and possessions (the estate) of the person who’s died, you’ll need to identify:

• the things they owned (their assets)
• their debts

Assets include things like bank accounts, savings and pensions, as well as property, household goods and personal items.

Debts include things like utility bills, mortgages and money owed on credit cards. They also include funeral expenses, such as the cost of a funeral director, a headstone or plaque and refreshments.

You’ll then need to:

• find out which organisations to contact (you can do this by searching through the person’s papers or asking friends, family and any solicitor or accountant they had)
• write to these organisations asking for the value of the asset or debt when the person died (you’ll need to include a copy of the death certificate)

Which organisations to contact

Organisations that hold a person’s assets often include:

• their bank
• their pension provider - ask if you should include any private pension when you value the estate
• their employer - the person may be owed wages
• any companies they held shares in - include the number of shares, company details and the share certificate number (if you have it)
• National Savings and Investments (NS&I) for Premium Bonds - use the if you cannot find certificates
• other organisations that hold assets like ISAs, shares, investments or assets in a trust
• their landlord, if they had one - the person may have paid rent in advance

In your letter to the bank, also ask for:

• any standing orders and direct debits to be stopped (or transferred if they were in a joint name)
• a list of any share certificates or deeds they were holding for the person who died

If the person had a mortgage

Ask the mortgage lender if they require payments to continue while you’re applying for probate. If they do, you need to either:

• pay these bills yourself - and reclaim them from the estate once you’ve got probate
• check if the person had a life assurance or mortgage protection policy that covers these payments

You need an estimate of the estate’s value (the money, property and possessions of the person who’s died), to find out if there’s Inheritance Tax to pay.Ìý

There’s normally no Inheritance Tax to pay if either:

• the value of the estate is below the £325,000 threshold
• you leave everything above the £325,000 threshold to your spouse, civil partner, a charity or a community amateur sports club

If the person who died was widowed or is giving away their home to their children, the tax threshold can be higher.

Working out your estimate

You need to estimate the total value of the estate. This includes:

• the value of the things the person owned (their assets) on the day they died
• any gifts they made, such as cash or items of value, in the 7 years before they died
• the value of any trusts where the person had a beneficial interest

Your estimate will help you check if the estate’s value exceeds the threshold. If it does, you’ll need to provide valuations for the assets to see how much Inheritance Tax is due.

You can work out the estimate yourself or you can use the Inheritance Tax checker.

Check if you need to pay Inheritance Tax

The tool will:

• give you an approximate value of the estate

• help you decide whether any Inheritance Tax is likely to be due or not

The tool does not:

• calculate the amount of Inheritance Tax due

• tell HMRC about the estate’s final value

Before you start, you’ll need the following information:

• details of the person’s assets, including joint assets
• details of any gifts they made

Valuing the assets

Start by listing the person’s assets - things belonging to them with a financial value. Then find out or estimate the value of each on the date the person died.

These may include:

• their home

• any other properties, buildings or land

• money in banks, building societies or ISAs, or cash in their home

• stocks and sharesÌý

• household and personal items, including antiques, electrical goods, furniture, jewellery, paintings, and stamp collections

• cars, caravans or boats

• foreign assets, such as property abroad

• money they’re owed, for example, wages or refunds from household bills

• payments when they died, for example, life insurance or a lump sum ‘death benefit’ from a pension

For things like bank accounts, ISAs and pensions, you should contact the relevant organisation to get an exact figure.Ìý

For items such as cars, jewellery, and paintings, work out how much you would have got if you’d sold them. You can search for similar items on online marketplaces for this.

Valuing joint assets

You need to find out what assets the person owned with someone else and how they were owned.

The rules for valuing joint assets, such as property, jewellery or paintings, are different depending on whether they were owned as:

• ‘joint tenants’ (known as ‘joint owners’ in Scotland)
• ‘tenants in common’ (known as ‘common owners’ in Scotland)

Joint tenants

Joint tenants automatically pass on any assets, such as land or property, to the other owners if one of them dies.

If the asset, such as land or property, was owned as a joint tenant with the person’s spouse or civil partner, divide the value of the asset by 2.

If land or property was owned with other joint tenants, for example friends or siblings, do both of the following:

• divide the value by the number of owners
• take 10% from the share of the person who died

In Scotland, if land or property was owned jointly with others (excluding a spouse or civil partner), take £4,000 off the value of the whole asset before working out the person’s share.

To value a joint bank account, divide the amount by the number of account holders, unless it’s in joint names for convenience only. For example, an older person may add their child to help them with the account. If so, use the amount the person actually owned instead.

Tenants in common

The rules are different for tenants in common as they do not automatically pass on any assets they jointly own.

If the person who died jointly owned property or land as a tenant in common, work out the value based on their share.

Working out the value of any gifts

You need to work out the value of any gifts made by the person who died.

Gifts only count towards the value of an estate if they were made in the 7 years before the person died and the total value of the gifts was over the £3,000 annual exemption.

Any gift a person continued to benefit from before they died also counts towards the value of an estate - for example, if they gave away a house but lived in it rent-free (known as a ‘gift with reservation’).

There’s no Inheritance Tax to pay on gifts to charities or political parties.

What counts as a gift

A gift can include:

• money
• household and personal goods, for example, furniture, jewellery or antiques
• a house, land or buildings
• stocks and shares listed on the London Stock Exchange
• unlisted shares held for less than 2 years before the person’s death

Checking for gifts

You can check for gifts by:

• going through bank statements
• talking to family members
• looking through financial documents

Record the value of any gift and the date it was made.

Estimate the gift’s value

To estimate the value of each gift, use either:

• the approximate value of the gift at the time it was made (realistic selling price)
• the realistic selling price of the gift if the person who died continued to benefit from the gift after giving it away (a ‘gift with reservation’)

Debts

Do not include the estate’s debts when you estimate its value. However, you’ll need to tell HM Revenue and Customs (HMRC) about any debts if you need to report the value.

Check for records of debts when the person died, for example:

• their mortgage, loans, credit cards or overdrafts
• household bills
• bills for goods or services they’d received but not yet paid for (like building work, decorators or accountants)

What to do next

Check if you need to send full details of the estate’s value.

Whether you need to report the value of the estate - and how you do this - depends on several things, including if there’s Inheritance Tax to pay. You may need to send full details of the estate’s assets and debts.

If Inheritance Tax is due

You can use the online checker tool to find out if there’s Inheritance Tax to pay.

If there is, you’ll need to send full details of the estate’s assets and debts within 12 months of the person dying and before applying for probate.

When to send full details of the estate’s value even if no tax is due

You’ll need to send full details of the estate’s assets and debts, even if there’s no tax to pay, if the person who died:

• gave away over £250,000 in the 7 years before they died
• gave gifts then continued to benefit from them in the 7 years before they died
• left an estate worth more than £3 million
• was ‘deemed domiciled’ in the UK
• had foreign assets worth more than £100,000
• was living permanently outside the UK when they died but had previously lived in the UK
• had a life insurance policy that paid out to someone other than their spouse or civil partner and also had an annuity
• had increased the value of a lump sum from a personal pension to be paid after their death, while they were terminally ill or in poor health
• had agreed that property they’d given away during their lifetime would be part of their estate rather than pay a pre-owned asset charge

You must do this within 12 months of the person dying.

If the estate includes trusts

You’ll need to send full details of the estate’s assets and debts if the person who died:

• gave gifts that were paid into trusts
• held assets worth over £250,000 in trust
• held more than one trust

You’ll also need to send full details if assets held in trust passed to a surviving spouse, civil partner or charity and the trust was worth:

• £1 million or more
• £250,000 or more after the amount passing to the surviving spouse, civil partner or charity has been deducted

When full details are not needed

You do not have to give full details of an estate’s value if all of the following are true:

• the estate counts as an ‘excepted estate’
• there’s no Inheritance Tax to pay
• you’ve checked that none of the reasons under ‘when you need to send full details of the estate’s value even if no tax is due’ apply

Most estates are excepted estates.

What counts as an excepted estate

An estate is usually an excepted estate if any of the following apply:

• its value is below the current Inheritance Tax threshold
• the estate is worth £650,000 or less and any unused threshold is being transferred from a spouse or civil partner who died first
• the person who died left everything to a spouse or civil partner living in the UK or to a qualifying charity, and the estate is worth less than £3 million (search the charity register for registered UK charities)
• the person who died was living permanently outside the UK (a ‘foreign domiciliary’) when they died, and the value of their UK assets is under £150,000

What to do next

The process you need to follow depends on whether:

• you have to send full details of the estate’s assets and debts
• it’s an excepted estate

Dealing with an excepted estate

You can report the value of an excepted estate if you apply for probate. Check if you need probate and apply for it if you do.

You do not need to report the value of an excepted estate if you do not need probate.

Applying for probate in Scotland or Northern Ireland

There’s a different way to apply for probate if the person who died or .

If you need help with probate or the value of the estate

Contact HM Courts and Tribunals Service if you’re not sure if you’ll need probate or if the value of the estate changes.

If you need help with Inheritance Tax

Contact HM Revenue and Customs for questions about Inheritance Tax.

You must report the value of the estate to HM Revenue and Customs (HMRC) by completing form IHT400.

You must submit the form within 12 months of the person dying and before applying for probate (if you need it).

Getting accurate valuations

You’ll need to give accurate valuations when you complete the form.

You can get any property or land valued by an estate agent or chartered surveyor.

You can also get a professional valuation for anything worth over £1,500.

You can estimate the value of cheaper assets, such as electrical items and ordinary household goods.Ìý

For things like cars, jewellery, and paintings, work out how much you would have got if you’d sold them. You can search for similar items on online marketplaces for this.

Report the value of the estate by completing form IHT400

You need to download and complete form IHT400. Send it to the address on the form.

When completing and submitting the form, make sure you:Ìý

• answer all relevant questionsÌý
• complete and send any relevant additional pages (known as ‘schedules’)ÌýÌý
• only send a copy of the will (if there is one) and include copies of any official alterations (known as ‘codicils’) - do not send any originals

You can read guidance on how to complete form IHT400.

If you need help completing the form

Contact HMRC’s Inheritance Tax helpline for help with completing form IHT400.

Once you’ve submitted the form

HMRC will work out how much tax is due, as well as any interest you may need to pay. They will write to you with their calculations and tell you what happens next.

When HMRC may carry out further checks

Occasionally, HMRC may carry out further checks on the information you’ve provided (known as a compliance check).

This may include the Valuation Office Agency (VOA) or Shares and Asset Valuation team (SAV) checking any valuations provided.

If your form is selected for further checks

HMRC will write to you if they’re carrying out further checks.

HMRC will then phone to explain what they are checking. They’ll do this within 8 weeks of writing to you.

If they ask you for more information, they’ll agree when you need to provide it.

If the VOA or SAV need to check valuations

The VOA or SAV may contact you about the valuations you’ve provided.

If they decide that any of the assets are worth more than the valuations provided, HMRC will send you new calculations once the values have been agreed.

Telling HMRC about changes to the value of an estate

You need to tell HMRC about any changes once the values are final or 18 months after the person died, whichever is sooner.

If the values are not final or it’s less than 18 months since the person died, you only need to tell HMRC if:

• there’s a change in value to land, buildings or unlisted shares
• you’ve sold land or shares at a loss
• you’ve sold any assets on which you were paying tax by instalments
• the value of the estate increases or decreases by more than £50,000 before any exemptions or reliefs
• the person who died made a gift with reservation or was the ‘beneficiary’ of a trust when they died
• further checks are being carried out on the estate

How to tell HMRC about any changes

You’ll need to complete a corrective account form or for estates in Scotland a corrective inventory and account (Scotland). Once completed, send to the address on the form.

You’ll need to calculate any additional tax due and make a payment on account to stop any interest from accruing. HMRC will send final calculations once they have all the details.Ìý

Claiming relief on property or shares sold at a loss

To claim relief on land or buildings sold at a loss within 4 years of the person dying, complete form IHT38.

To claim relief on shares sold at a loss within 12 months of the person dying, complete form IHT35Ìý

Once completed, send to the address on the form.

Paying Inheritance Tax

You must pay Inheritance Tax by the end of the sixth month after the person died to avoid paying interest. For example, if the person died in January, you must pay by 31 July.

You can pay in yearly instalments on certain things that may take time to sell, such as a house.

You’ll need to get an Inheritance Tax reference number from HM Revenue and Customs (HMRC) at least 3 weeks before paying any tax.

When you can apply for probate

HMRC will send you a unique code confirming you’ve paid enough tax. You’ll usually get this within 20 working days of them receiving your IHT400 form or Inheritance Tax payment, whichever is later.

You’ll need this code to apply for probate in England and Wales or confirmation in Scotland.

If you’re applying for probate in Northern Ireland

Complete form IHT421 and send it to HMRC with form IHT400.

HMRC will fill in their part of form IHT421 and return it to you. You’ll usually get it within 20 working days of them receiving your IHT400 form or Inheritance Tax payment, whichever is later.

You’ll need it to .

You must keep certain records after you value an estate.

You must keep copies of any:

• will
• copies of signed Inheritance Tax forms and supporting documents
• records showing how you worked out the value of assets in the estate, for example an estate agent’s valuation
• documents showing any unused Inheritance Tax threshold that can be transferred to a surviving spouse or civil partner
• final accounts

Final accounts

Include any documents showing how you distributed money, property or personal belongings from the estate, for example:

• letters from HMRC confirming that you paid Inheritance Tax
• receipts showing debts paid, for example utilities bills
• receipts for your expenses from dealing with the estate
• written confirmation that ‘beneficiaries’ (anyone who inherited) received their share of the estate

Send copies of the final accounts to all beneficiaries.