When someone has died, one of the first things you will need to do is establish whether you need to pay inheritance tax. In order to achieve this, you will need to conduct a thorough search for all assets and debts in the name of the deceased and find out their resale value (not the insurance value or replacement value) at the date of death.
This will then allow you to calculate the estate’s value in order to see if the free (no-tax) threshold has been breached.
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Tip: Inheritance tax is not always due, but if it is, you need to pay it within 6 months of the date of death, otherwise you will have to pay interest on the outstanding balance.
We recommend aiming to have an estimate of the value 5 months after the date of death because it can take at least 3 weeks to apply for an inheritance tax reference number. Valuing an estate can take months so it’s important to start doing this as soon as possible.
We recommend aiming to have an estimate of the value 5 months after the date of death because it can take at least 3 weeks to apply for an inheritance tax reference number. Valuing an estate can take months so it’s important to start doing this as soon as possible.
The deceased has left a spouse or civil partner. What does that mean for the estate’s value and inheritance tax?
Where assets are jointly owned by the deceased and a spouse or civil partner, you will need to determine the value that was owned by the deceased. This applies to all assets and debts regardless of type.
So if Dave and Anne jointly owned £10,000 in savings and Dave died, you would need to document the £5,000 which would be Dave’s share of the account.
The exception to this is if the owners of the account have filed Income Tax form 17, which allows them to declare a different proportion of ownership, so in the above example, Dave might have used this form to declare ownership of 75% of the account, £7,500, so that he could pay more income tax than Anne.
If the deceased left everything to their spouse or civil partner, then there will be no inheritance tax to pay.
You may still need to value the estate and send details to HMRC (using form IHT400) if you need to apply for probate in order to ask 3rd parties to transfer assets to the surviving spouse or civil partner.
If you are stuck or have any questions about shared assets, enter your phone number below and someone from our free probate advice service will call you back within 30 mins to advise you:
Before Starting
- Plan how you are going to file any documents safely
- Create a spreadsheet to log all assets and their values. Remember to include debts and funeral costs as money taken away from the estate (minus numbers)
- Create a log of which organisations you have contacted and whether they have responded
Tip: HMRC can ask for details of the estate for up to 20 years after the death, so make sure you plan ahead and establish a system for organising and storing all relevant information.
How to Find and Value the Assets and Debts
There are two types of asset: those held by a 3rd party like a bank account or financial advisor, and those you have direct access to, like cars and cash.
For those held by a 3rd party, you will need to contact these organisations and ask for the value of any assets held by the deceased at the date of death.
Other assets, such as jewellery and cars will be things that you find first, and then you will need to find or calculate a valuation yourself for an estimate, or if you believe the estate will be liable to pay tax, a RICS valuation will be needed.
If you need help with this process, enter your phone below and one of our advisors from our free probate advice service will call you to discuss your options:
Contacting the Organisations
Write to any applicable organisations asking for information about the deceased’s assets and debts, as well as a valuation on the date of death.
You’ll need to include a copy of the death certificate and may need to include a certified copy of the will to prove that you have a right to the information.
For more guidance around wills, please see our article on Finding the Will
Do not send any original copies of wills or codicils to any organisation except the Probate court.
Digital assets may be particularly difficult to access, as the deceased’s email provider(s) may not provide you with access to their account, however they may provide you with details of any digital billing the account received.
Tip: Be very careful around email security. Email providers have no obligation to allow you access to the deceased’s account, however they might provide details of relevant emails, for example from financial institutions.
If you have access to the deceased’s email, you must be careful never to lock yourself out of the account, or you may never access it again. Sometimes email accounts will ask for 2-factor authentication, using the phone number attached to the account.
If you disconnect the phone number, then you might lose your access to the account, should you come up against this security wall.
If you have access to the deceased’s email, you must be careful never to lock yourself out of the account, or you may never access it again. Sometimes email accounts will ask for 2-factor authentication, using the phone number attached to the account.
If you disconnect the phone number, then you might lose your access to the account, should you come up against this security wall.
I Don’t Know if I Can Find All the Assets
We can conduct an asset search on your behalf to identify the assets and debts held by the deceased, providing you with peace of mind that the correct information is communicated to HMRC. This process takes around 60 days.
To find out more, enter your phone below and one of our advisors from our free probate advice service will call you to discuss your options:
List of Assets and Debts and How to Find Them
Funeral Expenses
How to find
These are likely to be the first debts you will have access to. Whoever organises the funeral needs to keep records and receipts of the funeral costs. Otherwise, you will need to contact any funeral directors or other funeral services that were used to ascertain the costs.
Bank Accounts, Savings, Investments and Pensions
How to find
Search for any documents in the residence and write to any companies where money is held. Include a copy of the death certificate and the will if there is one.
Once you have access to the main current account, you will be able to use their bank statements to find other sources of assets.
Financial planners may also have details of any accounts, if the deceased used one.
Tip: Ask for access to bank statements. These will be helpful for determining other assets and debts such as gifts given, loans and mortgages being paid, wages or benefits being received.
Credit Card Debt, Overdrafts
How to find
Check all wallets, purses, bags and documentation for credit and debit cards. Contact all companies for which they have a card.
They may also have a digital wallet with a company such as Paypal which may not have a physical card.
Mortgages, Loans and Repayment Plans
How to find
Mortgages and loans should be available through the deceased’s bank.
Check their statements for any ingoing or outgoing transactions to any other financial institutions.
If there are companies you don’t recognise, they may have a different trading name to their advertised name, so you may be able to find them on companies house:
https://www.gov.uk/get-information-about-a-company
Tools such as https://www.finder.com/uk/buy-now-pay-later-providers-uk can provide details of repayment companies.
Wages, or Invoices Owed to their Company
How to find
Contact the HR department of any company they worked for in the past year.
If they had a business, you will need to go through their invoices to check they were paid.
If they have an accountant, then they may be able to do this for you.
Trusts where the Deceased had a Beneficial Interest (received money from them)
How to find
Financial planners or solicitors would have this information.
Arrears of Unclaimed Benefits, Tax Repayments, any Refunds Due
How to find
The Tell Us Once service is provided by the government and is normally requested at the same time that you register the death or shortly after (the registrar should provide details or help you to request the service). This should notify all the applicable government departments, including:
- HM Revenue and Customs (HMRC) - to deal with personal tax and to cancel benefits and credits, for example Child Benefit and tax credits (you need to contact HMRC separately for business taxes, like VAT)
- Department for Work and Pensions (DWP) - to cancel benefits and entitlements, for example Universal Credit or State Pension
- Driver and Vehicle Licensing Agency (DVLA) - to end the vehicle tax (you must contact DVLA separately if you either sell the vehicle or keep it and tax it in your own name)
- The local council - to cancel Housing Benefit, Council Tax Reduction (sometimes called Council Tax Support)
- Veterans UK - to cancel or update Armed Forces Compensation Scheme payments
- Social Security Scotland - to cancel benefits and entitlements from the Scottish Government, for example Scottish Child Payment
How to value
If you do not receive information from the above government departments, ring them separately to ask for any outstanding payments or debts due at the time of death.
Utility Bills, Rent Due
How to find
To find out if the property was rented, you can do a property search to find out who owns the property: https://www.gov.uk/search-property-information-land-registry
For utility bills there are a number of search tools online:
- Gas: https://www.findmysupplier.energy
- Electricity: https://www.energynetworks.org/customers/find-my-network-operator
- Water: https://www.water.org.uk/advice-for-customers/find-your-supplier
- Phone / Broadband: Dial 150 to find the phone line provider. Broadband will normally have its own router box in the house, otherwise check for documents relating to broadband
How to value
Find out from the estate agent or landlord how much was outstanding on their tenancy contract.
Ask for the account balance from the date of death for utility providers.
Property, Household Goods, Personal Items, Cars
How to find
Search their main residence. List all furniture, electronics, white goods, jewellery, vehicles (including bikes or scooters) and anything else you see. It may make sense to take pictures of every room for your records.
Contents / home insurance providers often have tools to help you list all the items in a house. Here is an example from confused.com: https://www.confused.com/home-insurance/contents-calculator
How to value:
Property
There are three main options:
- Compile 3 valuations from estate agents and take the average amount. This will make you liable if the amount is challenged by HMRC, therefore it is important to ensure that any estate agents are providing you with a tax-ready valuation and not a marketing valuation.
- Pay a RICS Surveyor to value the property for you. This can provide peace of mind as if HMRC challenge the valuation, you can sue the surveyor for any extra payment you need to make against your IHT bill.
- Use our partner, Sail Homes who can provide you with a free RICS quality valuation with an easy-to-read report for evidencing purposes, and who will also approach three other estate agents on your behalf so you have the best of both worlds. If this is of interest call 0808 196 5200 to find out more.
Sail Homes, our partner and Probate Property Expert, offers a free service that includes an HMRC compliant valuation and liaising with estate agents on your behalf, saving you the hassle of chasing them yourself. Call them today on 0808 196 5200 to book in your free valuation.
Jewellery
Ask a jeweller or a pawn shop for a valuation.
Household goods
Research second-hand furniture, white goods, etc., to determine how much the furniture might be worth if you sold it on. If you have antique furniture, you may get more for this at auction, so you will need to take special care to evaluate it thoroughly, checking for things like artist’s signatures, the upholstery, etc. If you suspect that you will need to pay insurance tax, a RICS valuation will be needed.
If you need help with this process, take advantage of our free probate advice service and enter your phone below and one of our advisors will call you to discuss your options:
Cars
Used car companies like autotrader and webuyanycar have free valuation tools.
Gifts Given 7 Years before the Date of Death
How to find
Contact all friends and family to ask them for this information, remember to include gifts that are money, as well as other gifts such as cars, caravans, household appliances, jewellery, shares in a business, etc.
Many gifts are exempt from inheritance tax, however it is prudent to list all gifts first so that you can deduce this later on and have the documentation available as evidence.
How to value
If it is money, such as cash or shares, you can just list the monetary amount.
If it is anything else, you will need to value it at the date of death, as with the other assets you have direct access to, such as cars and property.
Life Insurance Policies
How to find
If a life insurance policy is not in trust, then it may count as an asset and be liable for inheritance tax, but it may also be used to help pay the inheritance tax bill.
Check bank statements for any outgoing payments and any documentation in the deceased’s house for any evidence of life insurance.
Financial planners may also know about existing life insurance policies.
Money Due from the Estate of Someone who Died before them
How to find
Check their paperwork and ask friends or family if this is likely to be the case.
How to value
If the deceased was entitled to inherit from a predeceased individual, you will need to check the predeceased’s will to see what they were entitled to.
Then if applicable, you can use the value of any inheritance as determined by the predeceased’s executor, unless it is property or another commodity which fluctuates, such as gold. In this case, you will need another valuation for the date of death for the deceased person for whom you are valuing the estate.
Remember to acquire any evidence of the previous valuations as required.
Business Assets
How to find
There are many ways in which someone might have assets in a business, including shares, partnerships, sole trading, etc.
Depending on the nature of the business and their assets, you may need to speak to:
- The finance department
- The board
- Any accountants who work with the business
If the deceased owned the business, you may also be responsible for certain business tasks such as ensuring wages are paid and dealing with debtors and creditors.
Business Tax and Expenses Due
How to find
This is most likely to be applicable in the instance that the deceased was the sole owner of their business.
It can be very complicated, as you will need to know the tax and expenses due at the date of death whilst you are also potentially continuing to run the business throughout the probate process.
How to value:
You will need to work with the business’s accountant if they had one, any other high-level staff or work through the business files yourself to find out these numbers.
What do I do once I know the full asset list?
You will need an estimated value of the entire estate in order to ascertain if you need to pay inheritance tax.
Once you have all the details from 3rd parties, you should be able to make an accurate estimate of the estate’s worth, which you can then compare against the inheritance tax thresholds to determine if you are likely to need to pay inheritance tax.
If you think you will need to pay inheritance tax, you will need to create a definitive value in order to pay inheritance tax and file the details of the estate, otherwise you can begin to apply for probate if needed.
I need help!
We understand that this can be a difficult and overwhelming process, and we want to ensure that you have the support and guidance you need.
Our team of experts can provide you with advice and assistance on finding and interpreting wills, as well as guidance on the distribution of assets and property.
To take advantage of our free probate advice service, simply enter your phone number below. Our team is available to assist you and answer any questions you may have. Don’t hesitate to reach out for help – we are here to support you every step of the way.
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