How would I deal with property valuation for Local Property Tax? Self-assessment which is not perfect, but works generally.
One of the arguments against charging CGT on shares on death is that it would be difficult to establish the base cost. That should not stop an otherwise good policy.
Likewise, if I had to work out the base cost for someone dying today who bought their house 20 years ago, I could do a good stab at it.
And if they bought it 30, 40 or 50 years ago, Brendan? Comparatively few people die within 20 years of buying their home.
Your analogy of valuations for LPT purposes is inappropriate. For starters, Revenue provide indicative LPT valuation estimates, which the owner can either use or discard. In most cases, the amounts at issue will only be a few hundred euro either way.
In the case of CGT, the owner is dead and was not within their lifetime mandated or even recommended to keep a permanent record of home improvements, conversions, extensions etc. So nobody surviving them is after their death going to have the first clue of what enhancement expenditure was made on the place during the period of ownership.
Unlike as with LPT, if anything is missed, the consequences in relation to tax overcharge could be significant. For example, a £10,000 improvement in the mid 1970s would with pre-2004 indexation and euro conversion translate into a deduction for CGT purposes of approx €100,000.
But if nobody, including the Revenue Commissioners, knows or could reasonably know whether or not such expenditure was made almost 50 years ago, how could a valid CGT assessment be raised on such a flimsy basis? And how would executors be expected to manage a risk of that magnitude?
The whole effort would most likely end in a Kafkaesque fiasco with significant reputational risk for both the Revenue and the government.
For that reason it'll never see the light of day.
If they added a kitchen 10 years ago, it's probably not reflected in the value today.
They'd still be entitled to enhancement expenditure relief even if the added kitchen had been demolished in the meantime.