Do You Need an Official House Valuation for Probate?

Not necessarily. There is no such thing as an officially approved probate valuer, and HMRC does not prescribe who must value a house for probate. What the law requires is a figure: the price the property might reasonably have been expected to fetch if sold on the open market on the date of death. How you evidence that figure is left to the personal representative, and the appropriate level of evidence is proportionate to the estate.

In practice this splits into two situations. Where the estate is plainly below the Inheritance Tax thresholds, the property is an ordinary house in an area with plenty of comparable sales, and nobody is likely to dispute the figure, written market appraisals from estate agents are widely used and routinely accepted. Where Inheritance Tax is in play, the property is unusual, a share is jointly owned, or the beneficiaries are not all on the same page, a RICS valuation carries considerably more weight.

The word "official" is what causes the confusion. Executors reasonably assume there is a stamp somewhere, or a list of approved firms. There is not. No report is pre-approved by HMRC, and no valuer can promise that a figure will be accepted. The useful question is not "is this official?" but "if HMRC's valuers ask in two years' time how I arrived at this number, what will I be able to show them?"

The statutory basis is section 160 of the Inheritance Tax Act 1984: the value of property is the price it might reasonably be expected to fetch if sold on the open market at that time. For probate, "that time" is the date of death. That means the figure is not the asking price you would set today, not a quick-sale figure to a cash buyer, not what the family feels the house is worth, and not the price you eventually achieve months later — although a later sale can become evidence about the earlier value.

Where the figure goes depends on the estate. Estates that must deliver a full Inheritance Tax account report land and buildings on form IHT405, submitted with the IHT400. For deaths on or after 1 January 2022, most estates that pay no Inheritance Tax fall within the excepted estates rules and report gross and net values through the probate application itself rather than a separate IHT205. Either way, the personal representative is signing to say the values are correct to the best of their knowledge.

HMRC's published guidance encourages executors to obtain a professional valuation where the estate is likely to pay Inheritance Tax or the property is difficult to value, and it points towards chartered surveyors for that work. It stops short of making one mandatory in all cases, and it does not certify, approve or accredit valuers, reports or websites. Check the current GOV.UK guidance for the estate you are administering, because the reporting routes have changed more than once in recent years.

An estate agent does not produce a valuation in the technical sense. They produce a market appraisal: an experienced local view of what the property would sell for, formed during a walkaround that usually takes half an hour or less. The purpose of the visit is commercial. The agent is pitching for the instruction to sell.

That is not a criticism, and an appraisal is genuinely useful evidence. A good local agent knows what is actually transacting on that street this month, which is exactly the knowledge the figure depends on. But it is worth being clear about what an appraisal does not include: no measured floor area, usually no written schedule of the comparable sales relied upon, no stated basis of value, no formal assumptions or limitations, no professional standard governing how it was prepared, and generally no professional indemnity cover standing behind the number.

There is also a structural point about incentives. Some agents pitch high to win the instruction, then chip the price later. Others quote conservatively to secure a quick, easy sale. Neither behaviour is dishonest, but neither produces the neutral, evidenced figure that a tax return is asking for. An appraisal given by a firm hoping to sell the property is not independent in the way a paid, instructed valuation is.

An estate agent appraisal is usually adequate where all of the following are true:

Usually not. Most high-street agents will visit and provide a written market appraisal for probate free of charge, because it puts them in a strong position to be instructed on the sale later. Free appraisals for executors are ordinary business for them, and you should not feel awkward asking.

Some firms do charge, typically where you want a formal written probate valuation letter rather than a sales appraisal. Fees in the region of £100 to £300 are common, and a number of agents refund or waive that fee if they are subsequently instructed to sell the property. If a firm quotes considerably more than that for what is still an appraisal rather than a Red Book report, you are close to RICS pricing and should compare the two properly.

Before you accept a free appraisal, settle four things in advance. Will it be provided in writing on letterhead, rather than as a verbal figure or a text message? Will the figure be expressed as the value at the date of death, with that date stated, rather than as today's asking price? What comparable sales is it based on? And does accepting it commit you to anything — a sole agency period, a tie-in, or a fee if the property later sells to a buyer they introduced? A free appraisal should carry no obligation to sell through that agent, and any document put in front of you that says otherwise is a sales agreement, not a valuation.

One further practical point. If the appraisal is carried out several months after the death, as most are, the agent will naturally describe the current market. Ask them explicitly to state the value as at the date of death. A competent agent can do this, and an appraisal that quietly values the property at today's date is answering a different question from the one HMRC asked.

The convention of obtaining three estate agent valuations and taking the average is widespread, and it is sensible as far as it goes. It is not, however, a rule. HMRC does not require three appraisals, does not specify averaging, and will not accept three weak figures simply because there are three of them. The practice exists to smooth out the commercial optimism in any single pitch.

If you are going to rely on it, do it properly:

A Red Book valuation is one prepared in accordance with RICS Valuation — Global Standards, the professional standards known as the Red Book, together with the UK national supplement that deals with valuations for taxation and other UK purposes. It is normally carried out by a RICS Registered Valuer, whose registration is checkable and whose work is subject to RICS monitoring.

Written valuations by RICS members must generally comply with the Red Book, subject to a small number of exceptions. One of those exceptions covers advice given in connection with, or in anticipation of, agency and brokerage instructions — which is precisely why an estate agent's market appraisal is not a Red Book valuation even when the firm employs RICS members. The distinction is deliberate, not a technicality.

What you receive is materially different from an appraisal. A Red Book report identifies the property and its tenure, records a physical inspection and measurement, sets out the condition, planning position and any rights or restrictions that bear on value, names the comparable transactions relied on and explains the adjustments made to them, states the basis of value and the effective valuation date, sets out the assumptions and any limitations, and is signed by a named valuer whose firm carries professional indemnity insurance. It is a reasoned document that a third party can audit.

Two clarifications matter to executors. First, a valuation is not a survey: unless you commission one, it does not report on structural defects, damp or the state of the roof. Second, a surveyor can value retrospectively. Instructing one nine months after the death is perfectly normal, because the valuer works from comparable evidence from around the date of death rather than from today's market.

A RICS Red Book valuation earns its cost whenever the property figure could move the tax, be reviewed by HMRC's valuers, or be argued about between people who are not going to agree. The following situations are the common ones:

The two documents do different jobs. Neither is a substitute for the other, and the comparison below is about fitness for the purpose of reporting an estate, not about which professional is better at their work.

Estate agent appraisals are usually free, with some firms charging around £100 to £300 for a formal written probate valuation letter and often refunding it against a subsequent sale.

A RICS probate valuation commonly costs £150 to £500 for a straightforward residential property. Larger homes, high-value property, tenanted or agricultural holdings, land with development potential and anything requiring extended research sit higher, often £600 to £1,500 or more, and some firms scale the fee to the property value. Expect VAT on top, and check whether a retrospective date-of-death valuation is quoted at the same rate.

Before instructing, get the scope in writing: the effective valuation date, whether the report is prepared to Red Book standards, what the fee includes, the turnaround time, and — the point most executors forget to ask — whether the surveyor will correspond with HMRC's valuers if the figure is queried later. That last item is where the difference between a paid valuation and a free appraisal becomes concrete.

One point to state plainly, because it is frequently misunderstood. Properly incurred valuation fees can ordinarily be paid from estate funds as an administration expense, so the executor does not bear them personally. They are not deductible when calculating Inheritance Tax. The IHT400 notes exclude the costs of dealing with the estate from the debts you can deduct, so a valuation fee does not reduce the tax bill.

Property values reported for Inheritance Tax are reviewed by HMRC's own professional valuers. Historically this work was carried out by District Valuer Services within the Valuation Office Agency, whose functions have been moving into HMRC; whichever name appears on the letter, the exercise is the same. An experienced valuer with access to Land Registry data and local sales evidence looks at your declared figure and forms a view.

Certain things attract attention: a figure that sits below the comparable evidence, a round number with nothing behind it, a sale shortly after death at a materially higher price, a co-ownership discount claimed without explanation, a transfer to a beneficiary rather than an open-market sale, and any property whose characteristics do not fit the local pattern. Enquiries frequently arrive many months after the account was delivered, sometimes after the estate has been distributed, which is exactly why the evidence file matters more than the confidence you felt at the time.

If HMRC's valuers propose a higher figure and it is agreed or determined, additional Inheritance Tax becomes payable, with interest running from the original due date. Whether a penalty follows depends on behaviour rather than on the size of the error: HMRC distinguishes between a figure reached with reasonable care that turned out to be wrong, a careless one, and a deliberate understatement. A written valuation, comparable evidence and a note of your reasoning are what reasonable care looks like on paper.

Personal representatives should also remember that they remain responsible for the estate return, and that distributing an estate before its liabilities are settled can expose them personally. A professional report is strong evidence of care. It is not a guarantee of acceptance, and it does not transfer the tax liability to the valuer.

A sale price above the declared figure is common and is not automatically a problem. Markets move, and a completion nine months after death in a rising market can reasonably exceed a correct date-of-death valuation. What matters is whether you can explain the gap: general market movement, competitive bidding, works carried out by the estate, or a buyer with a particular reason to pay more, such as an adjoining owner. A large gap over a short period with no explanation is the pattern most likely to prompt questions.

The reverse situation has its own relief. Where qualifying interests in land are sold within four years of the death by the appropriate person for less than the value reported for Inheritance Tax, a claim for loss on sale of land may be available on form IHT38, subject to conditions about who sells and how the sales are aggregated. It applies to estates that paid Inheritance Tax, so it is a reason to report a considered figure rather than a defensively low one.

There is also a Capital Gains Tax consequence that executors often miss. The probate value normally becomes the acquisition cost for CGT when the property is later sold by the estate or a beneficiary. Where the value was ascertained for Inheritance Tax purposes, it is fixed for CGT as well. Where no Inheritance Tax was payable and the figure was never ascertained, HMRC can revisit the base cost on a later sale. Understating the house on a non-taxable estate therefore tends not to save anything: it simply moves the exposure from Inheritance Tax to Capital Gains Tax, and adds an argument you would rather not be having.

For most estates, the decision can be made in an afternoon by working through the position in order: