Selling an Inherited Property, Probate, CGT and What to Do in What Order

Why the Order Matters

Selling an inherited property is not simply a case of calling an estate agent the week after a bereavement. There is a specific legal sequence that must be followed, and attempting to shortcut it, by marketing the property before obtaining the grant of probate, for example, can cause serious delays and legal complications later in the transaction.

This guide sets out the correct order of events, the tax implications, and the practical decisions you will need to make along the way.

Step 1: Obtain the Grant of Probate

Before any sale can legally proceed, the executor named in the will (or the administrator appointed by the court if there is no will) must obtain a **grant of probate** (or, where there is no will, letters of administration). This is the legal authority that confirms who has the right to deal with the deceased's estate, including selling property.

You cannot exchange contracts on a property sale without a grant of probate in place. Some estate agents will market a property prior to probate being granted, referred to as "probate pending", but buyers and their solicitors will not be able to exchange until the grant is issued.

The grant of probate is obtained from the Probate Registry. The timeline is typically six to twelve weeks from application, though complex estates or contested wills can take considerably longer.

**Documents you will need:**

• The original will (if there is one)
• The death certificate
• An estimate of the estate's value for Inheritance Tax purposes
• Completed PA1P or PA1A application form

If Inheritance Tax (IHT) is due on the estate, it must normally be paid before the grant of probate is issued, which creates a cash flow challenge, since you cannot sell the property to raise the funds without the grant. HMRC offers a facility to pay IHT on property in instalments, and some banks will release funds from the deceased's account to pay IHT directly.

Step 2: Obtain a Probate Valuation

For Inheritance Tax and Capital Gains Tax purposes, the property must be professionally valued at the date of death. This is known as a **probate valuation** and must be carried out by a qualified RICS surveyor or a reputable estate agent with demonstrable local market knowledge.

HMRC scrutinises probate valuations. If the property later sells for significantly more than the probate value, HMRC may challenge the original valuation and seek additional IHT. It is therefore important to obtain a realistic, evidenced valuation, not an optimistic one.

Keep a written copy of the probate valuation. You will need it to calculate Capital Gains Tax when the property eventually sells.

Capital Gains Tax on Inherited Property

When you inherit a property, your base cost for Capital Gains Tax purposes is **the market value at the date of death**, not the original purchase price paid by the deceased. This is sometimes called the "probate value" base cost or the "uplift" on death.

If you sell the property at or around the probate value, there may be little or no CGT to pay. If the property has increased in value since the date of death, for example, because the probate process took a long time or you held the property for a period, you will pay CGT on the gain above the probate value.

The annual CGT allowance is £3,000 (2025/26). Each beneficiary who holds a share of the property has their own annual allowance.

**Important:** If the inherited property was the deceased's principal private residence at the date of death and you sell it within 36 months, Principal Private Residence (PPR) relief may apply to some or all of the gain. Seek specialist tax advice if this applies.

Choosing Between Estate Agent and Auction

Estate Agent (Open Market)

Selling via an estate agent on the open market will typically achieve the highest price, assuming the property is in reasonable condition and you are not under time pressure. The process takes the same 10–20 weeks as any other sale.

This route is best if: the property is in good condition, beneficiaries agree on timing, and you are not facing probate-related cash pressure.

Auction

Auction sales are increasingly popular for inherited properties, particularly where:

• The property requires significant renovation
• Speed is a priority (auction completion typically occurs 28 days after the auction date)
• Beneficiaries want a clean, transparent process with a fixed endpoint
• There is uncertainty about the property's condition or legal title

Auction sales are legally binding on the fall of the hammer, which removes the risk of a buyer pulling out. However, properties typically sell at 10–20% below open market value at auction.

Modern method of auction (conditional) allows a longer completion period (56 days) and may suit buyers who need mortgage financing.

Clearing the Property

Before marketing, the property will need to be cleared of the deceased's possessions. This is often emotionally difficult and practically time-consuming. Options include:

• House clearance companies (typically charge £300–£1,000+ depending on volume)
• Charity collection for items of value
• Online auction platforms for furniture and effects

The property should also be checked for utility contracts, council tax liability, and buildings insurance. An empty property may require a specialist empty property insurance policy, standard buildings insurance often excludes extended vacancy.

Dealing With Disputes Between Beneficiaries

Disagreements between beneficiaries about whether to sell, when to sell, or what price to accept are one of the most common causes of delay in probate property sales. Common flashpoints include:

• One beneficiary wanting to buy out the others at below market value
• Disagreement about which estate agent to use
• One beneficiary wanting to retain the property as a rental investment
• Disputes about how the sale proceeds should be divided

Where beneficiaries cannot agree, the executor has the authority to act in the interests of the estate as a whole. If an executor is also a beneficiary and there is a conflict of interest, the court can be asked to appoint an independent administrator.

In the most serious cases, an application to the court under the **Trusts of Land and Appointment of Trustees Act 1996 (TOLATA)** can force a sale. This is costly and slow, and should be treated as a last resort.

A Clear Sequence of Events

Property Passport UK and Inherited Properties

Before instructing an agent, search the property on Property Passport UK to review its EPC rating, title tenure, flood zone classification, and sold price history in one place. This information helps you and your solicitor identify any issues, such as a short lease on a flat, or a flood risk designation, that should be resolved or disclosed before marketing.