completing IT38 form

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form11

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Query on valuations for computing inheritance tax.
I am applying for agricultural relief and I wanted to find out if the IT38 form is audited by revenue can they dispute the values of properties I put down. As in the current economic climate it is next to impossible to figure out actual values of properties both agricultural and non agricultural.

For example a semi d house in westmeath was almost 300k four years ago and today it could be worth any where between 80,000 and 240,000.
Likewise a farm in a nice area in Wicklow has got great potential but may not get any bids at an auction.

If I value the farm high for its potential what it would of got a few years ago and value the house low for what I could let it go for today I will qualify for agricultural relief, but could revenue dispute this and how do they go about doing it?

Do I need to get official valuations from multiple auctioneers or can I value the properties based on my understanding of the market?

Any help would be appreciated.
 
form11 said:
if the IT38 form is audited by revenue can they dispute the values of properties I put down.

Click to expand...

Yes, they can (and do...)

form11 said:


Do I need to get official valuations from multiple auctioneers or can I value the properties based on my understanding of the market?
Click to expand...

You need to obtain a valuation from a competent independent professional valuer. Your own estimate may well be similar but because you're not independent, Revenue may decide to disregard your figures in which case you may be liable to interest and penalties on any underpayment.

In view of the risks involved, IT38 returns are not really suitable for DIY jobs.
 
I'm with T on this one.

Get an auctioneers valuation for the land and house at todays date.

Remember you can reduce the value of a Principle Private Residence by the mortgage for he 80% test.
 
For the 80/ farmers test ref it39 mortgage can't be used. See Page 42 example 2.

On valuations I got two for the farm one at 8k per acre the other at 13k per acre. If I use only 12k per acre I qualify under the rule. But I still think 12k is very high. If I have a letter confirming the high price is that enough.
 
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