Where there’s a ‘Will’... is there a fee?
Recent press reports covered the increase in HM Revenues and Customs (HMRC) investigations into inheritance
tax valuations and marketing opportunity practitioners.
unearthed a for residential
As house prices creep back up to pre-recession levels (in the south-east anyway), out-of-date valuations can leave beneficiaries of a deceased’s estate vulnerable to challenge. For example, last year HMRC launched over 9,000 investigations into inheritance tax valuations and raised over £70 million in extra revenue as a result. Where they find an incorrect property valuation produced without ‘reasonable care’, the estate and its beneficiaries could end up having to pay a maximum fine of up to 100% of the additional tax liability, as well as the additional tax due. At an average of £24 600 per case, it can come as a shock to many.
The HMRC state on their website:
‘HM Revenue & Customs (HMRC) strongly recommend that you use a professional valuer because they'll make sure the valuation is as accurate as possible. You'll have to pay their fees, but you may be able to claim these back from the estate later.’
During an investigation when deciding whether ’reasonable care’ was taken, the HMRC will ask additional questions:
Did you seek professional advice from a qualified independent valuer?
Was the valuer’s attention drawn to particular features of the property (such as development potential; the existence of a tenancy or occupancy by people other than the deceased)?
Was anything unusual about the valuation questioned?
This is a clear opportunity for residential valuers to market their services with solicitors and other organisations who handle inheritance issues. You could also try to raise the issue in public forums (with the press, local radio/TV, blogs, and so on) as many families attempt to dispose of estates on a DIY basis.
For more information, follow these links: General news coverage:
PV panels, leases and the lenders
We have previously covered the relative benefits of leased PV panels (see Newsletter 15 and 17) and we are pleased to announce the Council for Mortgage Lenders (CML) and the Building Society Association (BSA) have now caught up with us.
In June the CML and BSA produced joint guidance for PV panel providers on what lenders will want to see before they consent to the lease of the roof space over a property. This guidance includes a template letter which can be used by the panel providers to confirm to lenders that their lease complies with the minimum requirements. Although arrangements may vary, most lenders will want to see any arrangement has the following characteristics:
The PV panel provider should contact the lender on behalf of the borrower;
the panels must be installed to an appropriate standard (for example, membership of the microgeneration certification scheme - MCS);
authorisation must be signed by the borrower;
Copy or details of the lease provided
Some lenders may have a fast track approach to giving their approvals while others will want to consider each application individually.
Clearly, this is still a developing issue but it will affect how a residential practitioner assesses a leased PV panel installation. Here are a few of the questions we think you need to resolve:
Has the installation been fitted by an approved MCS installer under the FITs scheme?
If yes, is it owned outright or is it leased?
If it is leased, has the lender approved the lease?
These are questions you should ask the seller and raise in your report. For more information, visit:
No. 18 June 2011