IHT405 Houses and Land Form: How to Fill It In (Worked Example)
Form IHT405 is where you report the deceased's land and buildings to HMRC: each property's address, tenure (freehold or leasehold), who valued it, and its open-market value at the date of death. For a solely owned home you enter the full value; for a jointly owned home you enter only the deceased's share (usually 50%). Below is a full worked example, plus how the home links to the £175,000 residence nil-rate band and what to do if it later sells for less than the probate value.
What IHT405 is for
IHT405 — "Houses, land, buildings and interests in land" — is a supplementary schedule to the full inheritance tax account, form IHT400. You use it to list every interest in property the deceased held: the main residence, holiday homes, buy-to-lets, agricultural land, even a share in a property they didn't live in. You do not use IHT405 for an "excepted estate" handled through the probate-registry route; you reach IHT405 only when you are completing the full IHT400 (see the GOV.UK inheritance tax guidance).
The form is laid out as a table. Each property gets its own row, and you complete the same set of columns for every one.
The IHT405 property table, column by column
HMRC's layout asks for the same details on each property. Here is what each column is really asking for and how to get it right.
| Column | What to enter | Practical tip |
|---|---|---|
| Item number | A sequential number (1, 2, 3…) for each property. | You'll cross-reference this number elsewhere on IHT400, so keep it tidy. |
| Full address & postcode | The complete address as it appears on the title or council tax bill. | If unregistered, attach a copy of the deeds description. |
| Tenure | Freehold or leasehold. For leasehold, note the unexpired term. | A short remaining lease materially reduces value — say so. |
| Description & tenancy | Type of property (e.g. semi-detached house) and whether it was owner-occupied, let, or vacant at death. | A let property is valued subject to the tenancy, which can lower it. |
| Name of who valued it | The valuer — a RICS surveyor's firm, an estate agent, or "the personal representatives". | Naming a qualified valuer carries far more weight with HMRC. |
| Open-market value at date of death | The price the property would fetch on the open market on the day the person died. | Not the asking price, not an insurance reinstatement value — the realistic sale price. |
"Open-market value" is the legal standard for inheritance tax under section 160 of the Inheritance Tax Act 1984: the price the asset "might reasonably be expected to fetch if sold in the open market" at the date of death. It is a willing-buyer, willing-seller figure — not a quick-sale or distressed price.
Worked example — valuing the family home
Persona: Margaret Whitlock died on 14 February 2026, leaving her three-bedroom freehold semi-detached house at 22 Elmfield Road, Harrogate. Her son David is the executor.
Step 1 — Establish tenure and ownership. David checks the Land Registry title (£3 online). The property is freehold and was registered in Margaret's sole name. So the full value flows into her estate.
Step 2 — Get a date-of-death valuation. David instructs a local RICS surveyor for a formal "Red Book" valuation. The surveyor inspects, reviews comparable sales from January–February 2026, and certifies an open-market value of £420,000 as at 14 February 2026.
Step 3 — Complete the IHT405 row:
| Field | Entry |
|---|---|
| Item | 1 |
| Address | 22 Elmfield Road, Harrogate, HG1 0XX |
| Tenure | Freehold |
| Description / tenancy | 3-bed semi-detached house, owner-occupied, vacant at death |
| Who valued it | Dalton & Reeve, Chartered Surveyors (RICS) |
| Open-market value at death | £420,000 |
Step 4 — Carry the total forward. The £420,000 is added to the IHT405 page total and copied across to the relevant box on form IHT400, where it joins the rest of Margaret's estate. Because the house was solely owned, the full £420,000 is taxable estate value (subject to allowances below).
Reporting a jointly owned home
If the deceased co-owned a home, you do not put the whole value on IHT405 — only their share. How you report it depends on the form of co-ownership, which you can confirm from the Land Registry title.
Joint tenants
The survivor automatically inherits the deceased's share by survivorship — it never passes under the will. For inheritance tax you still report the value of the deceased's share, but it generally goes on the joint-assets schedule (IHT404), not IHT405, because the transfer happens outside the estate. Practitioners usually allow a discount of around 10% on a jointly held residential share to reflect that a half-share is harder to sell on the open market; HMRC may accept or challenge this depending on the facts.
Tenants in common
Each owner holds a distinct, separable share that passes under their will or intestacy. The deceased's share — usually 50%, but check the title and any declaration of trust — is reported as their interest in the property.
Worked example — a 50% tenants-in-common share
Persona: Margaret had instead owned the Harrogate house jointly with her late husband as tenants in common, 50/50. The whole is worth £420,000 on the open market at her death.
Calculation: Her share is 50% of £420,000 = £210,000. Many practitioners then claim a discount of about 10% on a co-owned residential share (because a half-interest is less marketable), giving roughly £189,000. The discounted figure is what David would report as Margaret's interest, with a note explaining the discount so HMRC can review it. Whether the District Valuer accepts the discount depends on who the co-owner is and whether the property could realistically be sold with vacant possession.
RICS "Red Book" valuation vs an estate-agent appraisal
HMRC does not insist on a professional valuation in every case. For a modest, clearly valued home, a written estate-agent appraisal (ideally two or three) can be acceptable. But the larger or more borderline the estate, the more a formal valuation protects you.
| Estate-agent appraisal | RICS "Red Book" valuation | |
|---|---|---|
| Cost | Often free | Typically a few hundred pounds |
| Basis | Marketing opinion (sometimes optimistic or low to win the listing) | Formal date-of-death open-market value to RICS standards |
| Weight with HMRC | Lower; easier to challenge | High; harder for the District Valuer to displace |
| Best for | Small, straightforward estates well below the threshold | Larger estates, taxable estates, anything near a band edge, or where penalties for under-valuing would bite |
The District Valuer risk. HMRC refers property values to the Valuation Office Agency's District Valuer (DV). If the DV thinks you have under-stated the value, they can re-value the property and increase the tax — and an under-valuation that was negligent can attract penalties. Because the standard inheritance tax rate is 40% (GOV.UK), every £10,000 the DV adds can mean up to £4,000 more tax. A defensible RICS valuation, with comparable evidence, is the single best protection against a DV challenge.
How the home links to the residence nil-rate band
If the deceased leaves a home (or a share of one) to direct descendants — children, including adopted, foster and step-children, and grandchildren — the estate can claim the residence nil-rate band (RNRB) of £175,000 on top of the standard nil-rate band of £325,000. That can lift the effective threshold to £500,000 for an individual, and up to £1,000,000 for a married couple or civil partners where the first death's unused allowances transfer (GOV.UK: residence nil-rate band). These thresholds are frozen up to and including 5 April 2031 (GOV.UK rates and allowances).
The value you put on IHT405 is what the RNRB is measured against — but the RNRB is claimed on a separate schedule (IHT435), not on IHT405 itself. The RNRB is capped at the value of the home, and it tapers away for estates worth more than £2 million. So getting the IHT405 value right matters in both directions: too high and you over-state tax; too low and you risk a DV challenge and potentially lose RNRB you were entitled to.
Worked example — the home and the RNRB together
Margaret's solely owned house is worth £420,000 and she leaves it to her son David (a direct descendant). Suppose her total estate, including the house, is £600,000.
| Item | Amount |
|---|---|
| Total estate | £600,000 |
| Less standard nil-rate band | (£325,000) |
| Less residence nil-rate band (home left to son; capped at £175,000) | (£175,000) |
| Taxable amount | £100,000 |
| Inheritance tax at 40% | £40,000 |
Without the RNRB, the taxable slice would have been £275,000 and the tax £110,000. Leaving the home to a direct descendant saved £70,000 here.
If the property later sells for less than the probate value (IHT loss relief)
Markets move. If the home is sold for less than the IHT405 date-of-death value, you may be able to claim back the overpaid tax through loss-on-sale relief, using form IHT38.
- The sale must complete within four years of the date of death (three years if death was on or before 15 March 1990) — confirmed on the GOV.UK IHT38 page.
- It is claimed by the "appropriate person" — the people who were liable for the inheritance tax on that land (usually the executors).
- HMRC substitutes the actual sale price for the probate value, recalculates the tax, and refunds the difference.
- Watch the traps: all qualifying sales in the period are pooled (you can't cherry-pick only the losers), and small reductions below a de-minimis are ignored.
Worked example — claiming loss relief
Margaret's house was reported at £420,000. The market softened and David completes the sale in November 2026 — well within four years — for £395,000. He files IHT38. HMRC substitutes £395,000 for the £420,000 probate figure, a £25,000 reduction. At 40%, that recovers up to £10,000 of inheritance tax. (Selling costs are not deducted in the relief calculation — it's a like-for-like value comparison.)
A clean filing checklist
- Pull the Land Registry title to confirm tenure and whether ownership is sole, joint tenants, or tenants in common.
- Get a defensible date-of-death valuation — RICS "Red Book" for taxable or borderline estates.
- Enter only the deceased's share for co-owned property; note any co-ownership discount and your reasoning.
- Carry IHT405 totals correctly across to IHT400, and claim RNRB on IHT435 if the home goes to descendants.
- Keep the valuation evidence — if the home sells low within four years, file IHT38 to reclaim tax.
Frequently asked questions
Do I have to use a chartered surveyor for IHT405?
Not in every case. For a small, straightforward estate well below the threshold, written estate-agent appraisals can be acceptable. But for taxable estates, large properties, or anything near a band edge, a RICS "Red Book" valuation is strongly advisable because it carries much more weight if HMRC's District Valuer reviews the figure.
How do I report a house owned 50/50 with my spouse?
You report only the deceased's share. If they were tenants in common, that's their named share (usually 50%) and it passes under their will. If they were joint tenants, the share passes automatically by survivorship and is generally reported on the joint-assets schedule (IHT404) rather than IHT405. A discount of around 10% is often claimed on a co-owned residential share to reflect lower marketability.
What value do I put — the asking price or the sale price?
Neither. You put the open-market value at the date of death — the realistic price a willing buyer would pay a willing seller on the day the person died. This is the statutory standard under the Inheritance Tax Act 1984.
What is the residence nil-rate band and how does it relate to the home on IHT405?
It's an extra £175,000 allowance available when a home is left to direct descendants (children, grandchildren and similar). The IHT405 value is what the band is measured against, but the band itself is claimed on form IHT435. Combined with the £325,000 standard band it can give a £500,000 threshold per person, or up to £1,000,000 for a couple.
What if the house sells for less than the value I reported?
If the sale completes within four years of death, you can claim loss-on-sale relief on form IHT38. HMRC substitutes the actual sale price for the probate value and refunds the overpaid tax. All qualifying sales in the period are pooled, so you cannot claim only on the property that fell.
Can HMRC challenge my property valuation?
Yes. HMRC can refer the value to the Valuation Office Agency's District Valuer, who may re-value the property and increase the tax — with possible penalties for a negligent under-valuation. A professional valuation backed by comparable sales evidence is the best defence.
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General information, not personal United Kingdom tax/legal advice. Verify with a qualified professional.
Sources: GOV.UK — Inheritance Tax; GOV.UK — Residence nil rate band; GOV.UK — IHT thresholds and rates; GOV.UK — Form IHT38. Figures verified for 2026/27 (frozen to 5 April 2031).