Closer scrutiny for inheritance tax valuations
The rules on how estates are valued for inheritance tax could be tightened up.
It is mooted that HM Revenue and Customs (HMRC) is considering that people should arrange for three estate agents to value the worth of a property for inheritance tax purposes rather than the two that are required at the moment.
It is thought that the additional valuation would help to show that individuals took the “reasonable care” required by the law when assessing the value of a property.
Under the rules, properties that are incorrectly valued for inheritance tax can attract a penalty charge of up to 30 per cent of the extra liability.
There is a 12-month gap in which inheritance tax valuations can be submitted before late penalties come into effect. But so long as reasonable care is taken in getting the liability correct, any increase in value may not attract a penalty charge.