Inherited property, date-of-death value, and the CGT that follows

Inherited property, date-of-death value, and the CGT that follows.

Executors are usually asked for a valuation at the worst possible time, with the least information. This guide sets out exactly which value is needed, when the exemption applies, and what to gather before you call a valuer.

Updated 4 August 20268 min readWritten by a Certified Practising Valuer

Which value the estate actually needs

For CGT, the relevant figure is almost always the market value of the property on the date the owner died. That figure becomes the cost base for the beneficiaries where the property was the deceased's main residence, or where they acquired it on or after 20 September 1985 and it was not their home.

Probate and administration sometimes call for a value at a slightly different date, and family agreements sometimes call for a current value so the estate can be divided fairly. These are different reports. It is worth establishing which of them you need before instructing anyone.

The two-year rule, and what happens after it

If an inherited main residence is sold and settled within two years of the date of death, the gain is generally fully exempt and no valuation is needed for CGT purposes — though one may still be needed for probate or for dividing the estate.

Beyond two years, or where the property was rented out, a date-of-death valuation becomes essential because it establishes the cost base against which the eventual gain is measured. The Commissioner has a discretion to extend the two-year period in certain circumstances, which is a matter for your tax agent rather than your valuer.

Pre-CGT properties change the answer

Where the deceased acquired the property before 20 September 1985, the beneficiary is generally taken to have acquired it at its market value on the date of death rather than at the deceased's original cost. In practice this often produces a much higher cost base and a much smaller gain.

This is the single most valuable valuation an executor can obtain for an older estate, and it is also the one most often skipped because the family assumes an old property must mean an old cost base.

Valuing a property nobody can get into

Estate properties are frequently occupied, contested, or full of belongings nobody has been able to sort. None of that prevents a valuation.

Kerbside inspections with historical photographs and plans where access is refused

Valuation of the property in its actual condition, including deferred maintenance

Discreet attendance where a surviving spouse or tenant is still in the home

Separate values for a property and any subdivisible surplus land

In practice

We can deal directly with the estate solicitor or accountant so the family is not put in the middle of arranging access.

What to have ready before you instruct

A short list saves a surprising amount of time and fee.

The date of death and a copy of the death certificate or grant of probate

The full property address and, if available, the title reference

Whether the deceased lived in the property, rented it out, or both

Roughly when the deceased acquired it, and whether that was before September 1985

Any renovation history since acquisition

Contact details for the accountant or solicitor handling the estate

Common questions

How long after a death can a valuation still be done?

There is no time limit. We regularly prepare date-of-death valuations many years after the event, using sales evidence contemporaneous with the date of death.

Do all beneficiaries need their own valuation?

No. One independent valuation of the property at the date of death serves the estate. Where beneficiaries are in dispute, a single independent report is usually more persuasive than competing ones.

Is a date-of-death valuation the same as a probate valuation?

They are often the same figure, but they are prepared for different purposes and the wording differs. Tell us which you need — or both — and we will scope the report accordingly.