Probate value and market value are not the same thing. Probate value is the open market value of an asset assessed specifically as at the date of the deceased’s death, used to calculate Inheritance Tax liability. Market value, by contrast, refers to what an asset would realistically sell for at any given point in time, which may be weeks or months after the death occurred. The distinction matters enormously for executors and solicitors, because HMRC bases its Inheritance Tax calculations on probate value alone. The sections below address the most common questions that arise when navigating this difference in practice.
How is probate value actually calculated?
Probate value is calculated as the open market value of an asset on the date of death. This is defined under Section 160 of the Inheritance Tax Act 1984 as the price the asset might reasonably be expected to fetch if sold in the open market at that specific date, with no artificial restrictions on sale. It is a hypothetical but legally defined figure, not an estimate of what the estate eventually receives from a sale.
For property, this means a RICS-qualified valuer considers what a willing buyer would have paid a willing seller on that precise date, taking into account the property’s physical condition, location, comparable transactions, and prevailing market conditions at the time. For chattels such as furniture, jewellery, art, and collectables, the same principle applies: what would those items have fetched in the open market on the date of death?
Because the valuation date is fixed, it is entirely possible for the eventual sale price to differ from the probate value, particularly if the estate takes several months to administer. Neither figure is wrong in that scenario. They simply reflect different points in time.
Why does probate value often differ from the sale price?
Probate value differs from the eventual sale price because property markets and asset values move over time. The probate value is fixed at the date of death, while the sale takes place later, sometimes considerably later. In a rising market, a property may sell for more than its probate value. In a falling market, it may sell for less. Both outcomes are entirely normal and do not in themselves indicate that the original valuation was wrong.
There are also practical reasons for divergence. The condition in which a property is presented for sale, the marketing strategy chosen, the type of buyer attracted, and the negotiation process all influence the final sale price in ways that a probate valuation cannot account for. A probate valuation is an independent, objective assessment of open market value at a single point in time. It is not a prediction of what a motivated vendor will achieve through active marketing.
Where the eventual sale price is significantly higher than the probate value, HMRC may query the original figure. This is one reason why instructing a RICS-accredited valuer from the outset is so important: a well-documented, independently prepared probate valuation report provides a defensible, evidence-based figure that can withstand scrutiny.
What happens if probate value is set too low?
If probate value is set too low, HMRC may open an investigation into the estate. Undervaluation, whether deliberate or accidental, can result in additional Inheritance Tax being demanded, along with interest on the amount underpaid. In more serious cases, HMRC may also impose financial penalties. The estate, and potentially the executor personally, can be held liable for any shortfall.
HMRC has become increasingly active in scrutinising probate valuations that are not supported by a professional, independent assessment. An informal estimate from an estate agent, or a figure provided without a formal written report from a qualified valuer, is far more likely to attract challenge. Once HMRC opens an enquiry, the burden falls on the executor to demonstrate that the value declared was reasonable at the date of death.
The practical consequence is delay, cost, and stress at an already difficult time. Solicitors routinely insist on professional RICS valuations precisely because they protect both the estate and the executor from this risk. A valuation that complies with Section 160 of the Inheritance Tax Act 1984 and is prepared by a Registered Valuer gives HMRC no credible grounds to challenge the figure submitted.
Which assets need a probate valuation versus a market valuation?
Assets that form part of a deceased estate and are subject to Inheritance Tax require a probate valuation. This includes residential and commercial property, household contents, jewellery, art, antiques, collectables, vehicles, and financial assets such as shares and savings. A market valuation, by contrast, is used in commercial or transactional contexts where the goal is to establish a current sale price rather than a legally defined date-of-death value.
In practice, the two types of valuation often look similar, but they serve different purposes and carry different levels of formal documentation. A probate valuation must be prepared in compliance with the Inheritance Tax Act and, for property, in accordance with RICS Red Book Global Standards. It must be capable of being submitted to HMRC as part of the IHT400 form. A general market valuation does not carry the same legal weight and would not satisfy HMRC’s requirements for Inheritance Tax purposes.
Some assets, such as cash held in bank accounts or straightforward listed shares, do not require a formal valuation by an independent valuer; their value is established from official statements or closing prices on the date of death. It is the non-liquid assets, particularly property and chattels, where a professional probate valuation is essential.
When should a solicitor instruct a RICS valuer for probate?
A solicitor should instruct a RICS valuer as early as possible in the estate administration process, ideally as soon as the scope of the estate is known. Probate valuations must reflect the open market value at the date of death, so the sooner the instruction is placed, the more straightforward it is for the valuer to gather evidence and produce a defensible report. Delay does not make the valuation impossible, but it can complicate the evidential basis.
Early instruction is particularly important where the estate includes property, significant chattels, or any assets whose value is likely to attract HMRC attention. For high-net-worth estates, or where beneficiaries have differing views on value, an independent RICS valuation provides an objective figure that all parties can rely on. It also ensures that the IHT400 submission is not held up by missing or disputed valuations.
For straightforward estates, the standard turnaround is typically five working days. Where a Grant of Probate is needed urgently, written probate reports can be provided within 24 hours. Solicitors managing a caseload of estate matters benefit from having a reliable valuation partner they can instruct promptly, confident that every report will meet HMRC’s requirements without revision or challenge.
How Avery Associates supports solicitors with probate valuation
Avery Associates provides RICS-accredited probate valuations to over one hundred law firms across the UK, delivering the accuracy, compliance, and speed that solicitors need to progress estate administration without delay. Every instruction is handled by a Registered Valuer operating in full compliance with Section 160 of the Inheritance Tax Act 1984, underpinning a 100% HMRC acceptance rate.
- RICS Red Book Property Valuations prepared to the standard HMRC requires, with no ambiguity over methodology or independence
- Probate contents valuations covering household chattels, art, antiques, jewellery, and collectables, carried out by Registered and Accredited Valuers
- Standard five-working-day turnaround, with urgent written reports available within 24 hours
- Nationwide coverage through a network of local valuation teams, ensuring consistent quality in every county
- End-to-end estate support including house clearance, property sales, will searches, document retrieval, and vehicle disposal
- Full professional indemnity insurance on all work undertaken
For solicitors who need a valuation partner they can instruct with confidence, Avery Associates offers a free initial consultation and a seamless referral process. Contact the team to discuss your next instruction.
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