Your house
You may find that much of the value of your estate derives from your house or flat. Valuing your house may be easy to do if you know of similar properties which have been recently sold. However, it may be better to obtain a valuation from a local estate agent in order to confirm your estimate.
If there is a lack of comparable properties, this may make valuing your house or flat more difficult. An inaccurate valuation may be challenged by HMRC after your death, particularly if the value of your estate exceeds your tax-free allowance (nil rate band). This may involve lengthy negotiations before agreement on the valuation is reached.
Joint property
If you own property jointly, then your share in that property will form part of your estate for the purpose of probate. There is more than one way of owing a property jointly with someone else, and the way in which you do so may have inheritance tax implications.
Personal possessions
Valuable personal property should be professionally valued (e.g. by an auctioneer), especially if the value of your estate exceeds your tax-free allowance. If there is a recent and credible valuation in place, this may make probate smoother for your Executors after your death, otherwise they will have to obtain the valuations themselves. For items thought to be worth more than £1,500, HMRC have said that a professional valuation needs to be obtained.
Other less valuable, and more commonplace, possessions need only a rough estimate as to their second-hand value. Examples of such items may include, but are not limited to:
clothing;
electronic equipment;
books; and
other general household items.
Other assets
If you own shares, then any dividends declared before the date of death, but not yet paid, will be counted towards your estate.
In addition, the value of any savings accounts you have will include any interest accrued up to the date of your death.
Remember, however, that life insurance policies and pensions do not form part of your estate if they are paid direct to a member of your family by the insurer or pension provider.
Valuing assets
When assets are being valued for probate, the valuation should be as at the date of death. For property, this will be what the market value at that time is; for personal possessions, it will be that they will fetch on the open market at the date of your death, and so on.
However, when you are estimating the value of your estate for the purposes of making your Will, you cannot know exactly what each value will be. It can only be an estimate and values could change, sometimes quite significantly, by the time you die.