Changes to inheritance tax announced in last week’s Budget mean that the value of a property can be up to £1 million before the tax kicks in – previously it was £325,000.
Analysis of Land Registry data by NFU Mutual, a UK rural insurer and financial advice firm, has identified inheritance tax hotspots in England and Wales where homes are worth more than the £1 million cap.
A rush for market valuations could bring peace of mind for those with tax concerns but may leave looming insurance problems for up to a third of families living in high-value or listed homes which are more expensive to repair or rebuild.
Nicki Whittaker, high-value home specialist at NFU Mutual, said: “If you don’t know how much your home is worth, then there’s a real danger that you and your family could lose out. Around three in every ten homes are undervalued by their owners, leaving families at risk of underinsurance and an unexpected tax bill.”
Around 80 per cent of million pound homes sold in England and Wales in the last 15 years are in London and the South East, but there are concentrations of expensive homes across the rest of the country, including areas of Gloucestershire, Cheshire and Dorset.
Whittaker continued: “We expect there will be a rush to re-value these properties as parents and grandparents look to hand down as much as they can to their families.
“But many of these bespoke and listed properties need more thorough assessment to establish their true worth.
“Figures from our valuation partners show many expensive country homes are dramatically undervalued because owners are often unaware that the cost of rebuilding listed and unique properties is so much greater.
“It’s clear from these results that thousands more people need to take action if they want to make sure their biggest financial asset remains in the family. A valuation and some simple tax planning would help to make sure people are fully protecting what is rightfully theirs.”
Top five counties for properties worth £1m
(outside London and surrounding counties)
1 Dorset
2 Gloucestershire
3 Yorkshire
4 Cheshire
5 Somerset
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