How to Deal with Shares on a Taxable Estate

24 October 2018

If a taxable Estate contains shares which need to be sold or transferred, then the value of these shares will need to be reported to HM Revenue & Customs for Inheritance Tax purposes. We explain how to find out what the share value is and how to report this to HMRC.

What is a Taxable Estate?

A taxable Estate is when the Estate of a deceased person is liable for Inheritance Tax. This may be the case if the Estate falls above the Inheritance Tax threshold or 'nil rate band.' Whether or not an Estate is liable for Inheritance Tax can also depend on who will be inheriting from that Estate, as some Beneficiaries are exempt from Inheritance Tax.

For more information on how to establish whether an Estate is taxable or not, see Probate and Inheritance Tax.

Reporting the Share Value to HM Revenue & Customs

You will need to obtain a valuation of what the shares were worth at the date of death. This is the figure that will need to be provided to HM Revenue & Customs for Inheritance Tax purposes. There are several ways in which you can obtain the share value.

  1. Ask the share registrar (with whom the shares are registered) to provide this figure for you.

The share registrar is the institution that holds records of ownership for shares. There are multiple share registrars, so you will need to find out which registrar the shares are registered with first. Details of the share registrar should be clearly visible on any share paperwork that was sent to the deceased, so if you're unsure then this is a good place to look.

Once you have found out who the share registrar is, you can write to them requesting the share valuation on the date of death. You may need to include the death certificate with this request.

  1. You can research this figure yourself by looking up historical share information online.

You will need to look at the date of death then look at the highest and lowest share price on that date. You will then be able to calculate the average value based on the number of shares owned by the deceased. Only take this route if you're confident in your ability to accurately calculate the share value, as you could be held personally liable for any mistakes that you make.

  1. With Co-op's Probate Complete Service, we can do this for you.

Our award winning Probate team can take full responsibility for calculating the value of the Estate on your behalf, including the value of any shares, and reporting this information to HMRC. You would no longer risk being held liable for any mistakes you might make and we would liaise with HMRC to calculate and settle any Inheritance Tax that is due, meaning that you wouldn't have to worry.

Selling Shares on a Taxable Estate

If an Estate contains shares that were owned in the sole name of the deceased, then these shares will either need to be sold or transferred as part of the administration of the Estate.

Selling shares on a taxable Estate is much the same as it would be on a non-taxable Estate. The process for selling shares will vary, depending on how the shares are held and whether or not all the required paperwork can be found. See our article for more information on how the process works for Selling Shares during Probate.

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