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Historical property valuation (gifted as a PET)

Historical property valuation (gifted as a PET)

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I have a client who was gifted a house by her mother in 2003.

The mother bought it for £68k in 2000 and my client sold it in 2015 for £172,000.  It was gifted to my client in November 2003.

The house was the mother's PPR so no holdover relief claim was required or made.  Therefore my client's base cost would presumably be the value at the date of transfer.

Annoyingly nobody did a valuation of the house at the date of transfer. I have not had this before so my question is what do people do in this situation?

I can find various house price indices that would estimate the house was valued at the point of transfer between £115k and £125k, is it enough to take a few sources and take the average?  Or do people get a 'proper' valuation report done by a third party.  There are no comparable houses in the same street sold within a couple of years of the transfer.

Any suggestions welcome.

Replies (8)

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By The Innkeeper
17th Dec 2015 12:47

You are not

a valuer of anything especially property ( apart from unquoted shares {possibly}).  Get your client to use a suitably qualified firm of estate agents to produce a value. If you do it any other way and the value is successfully challenged by the DV your client could be considered to have been 'careless' if penalties are involved

Thanks (3)
Giraffe
By Luke
17th Dec 2015 13:26

Thank you

I didn't know what the usual procedure was or indeed who to ask.

Any idea what one would charge?

Thanks (0)
Giraffe
By Luke
17th Dec 2015 13:45

£100+VAT

Have just been quoted £100+VAT by a respected local estate agent which seemed reasonable to me. 

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By Phil Yaboots
17th Dec 2015 14:30

But make sure that the fact that you are using an estimate, however derived, is disclosed.

Thanks (1)
Giraffe
By Luke
17th Dec 2015 14:43

But

Surely if I have a valuation from an estate agent it is not an estimate?

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By SteveHa
17th Dec 2015 15:46

It's still an estimate of what the property would have been worth had it been put on the market at the date of the gift. A valuation by a suitably qualified professional, however, is unlikely to be challenged by HMRC.

Thanks (1)
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By The Innkeeper
17th Dec 2015 15:55

You should make clear

in 'white space' that the valuation has been supplied by a suitably qualified individual. Hopefully that should help stop any questions from HMRC.

I am not sure where you are based but here in London I would have thought that an Estate Agent would probably charge £300 - £500 plus VAT for this. So your quote of £100 is VERY low

Thanks (1)
Giraffe
By Luke
17th Dec 2015 17:39

Thanks

Not in London and prices a fair bit cheaper than London locally, so whilst £100 is a good price it is not ridiculously cheap for the area.

Will ensure I make a comment in the white space. 

Thanks for all help.

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