What does “probate value” mean for a house?

If you are dealing with the estate of someone who has died, you will often hear the term “probate value”. It matters most for property, because a house is usually the largest item in an estate. Getting the value right can affect whether Inheritance Tax is due and, later, whether anyone pays tax when the house is sold.

What “probate value” means

Probate value is the value of an asset on the date the person died. It is the figure the executors or administrators use when they report the estate. For Inheritance Tax, the law sets out the basic rule. Section 160 of the Inheritance Tax Act 1984 says property is valued at the price it might reasonably be expected to fetch if sold on the open market at that time.

So the probate value of a house is not what you hope it will sell for, or what it was worth years ago. It is a realistic open-market value at the date of death.

Why the probate value matters

1. Working out the size of the estate

The value of the estate helps decide whether Inheritance Tax may be due, and which forms the executors need to complete. GOV.UK’s guide to valuing the estate of someone who has died explains the steps.

2. Inheritance Tax

At the time of writing (October 2026), GOV.UK lists the standard Inheritance Tax threshold (the nil-rate band) as £325,000, with tax charged at 40% on the part of the estate above the threshold. An extra residence nil-rate band of up to £175,000 may apply when a home passes to children or grandchildren, with a taper for estates worth over £2 million. Spouses and civil partners can usually inherit free of Inheritance Tax, and unused thresholds can often pass to the survivor. Whether any tax is due depends on the whole estate, not just the house.

3. Capital Gains Tax if the house is sold later

For Capital Gains Tax, GOV.UK says inherited assets are generally valued at the date of death. In practice, the probate value is usually the starting point for working out any gain or loss when the property is sold. An undervalued house could mean a larger taxable gain later. An overvalued house could mean paying more Inheritance Tax than needed.

How a house is usually valued

There is no single required method, but common approaches include:

• Estate agent valuations. Some executors ask two or three local agents for a written opinion of value. This can work for smaller estates where no tax is likely.
• A RICS Registered Valuer. A formal valuation by a qualified surveyor may be sensible where Inheritance Tax is due, or the value is close to a threshold.
• Comparable sales. Recent sale prices for similar homes nearby can help support a figure.

Tell the valuer it is for probate, and that the value must be at the date of death. Describe the property accurately as it was on that date, including any repairs needed.

Jointly owned homes

How the home was owned affects the value included in the estate. GOV.UK’s estate valuation guidance explains that:

• for joint tenants who were married or in a civil partnership, you usually divide the value by two
• for joint tenants who were not married, you divide the value by the number of owners, and GOV.UK’s guidance allows a reduction from that share when estimating
• for tenants in common, you value the person’s actual share

Joint ownership rules can be complex, so it is worth asking a professional if you are unsure how a property was owned.

What if the house sells for a different price?

It is common for a house to sell for more or less than its probate value. What happens next depends on the details:

• If it sells for much more soon after death, HMRC may question whether the probate value was too low. Executors may need to explain the difference.
• If it sells for less within four years of the death, executors may be able to claim relief from Inheritance Tax for the loss, under certain conditions.
• If it sells for more later, Capital Gains Tax may be due on the increase, depending on the circumstances.

Common mistakes to avoid

1. using an old valuation or an online estimate without any checks
2. choosing a low value to reduce tax, which can lead to penalties and interest
3. forgetting that the value is at the date of death, not the date of sale
4. overlooking joint ownership or a share owned by someone else
5. not keeping a written record of how the value was reached

Timing and deadlines

Valuing an estate can take several months. GOV.UK says that if Inheritance Tax is owed, it must be paid by the end of the sixth month after the death to avoid interest. Executors often start the valuation early for this reason, even if the house will not be sold for some time.

Where to go from here

Our help article on documents you may need for probate lists what to gather. It is also worth reading how property ownership affects inheritance and what costs may be involved.

If you would like a professional to help value and administer the estate, you can find out about probate introductions. WillHarbour is an introduction service and does not give tax advice. We aim to introduce you to up to three appropriately qualified firms, which will explain their fees before you decide.