Capital Taxation - Level 2 Flashcards
East Finchley - How did you determine the condition?
- I spoke to the executor who gave me a full detailed overview of how the property was at the valuation date
- I asked the executor for photographs to determine the facts
East Finchley - Why were you able to factor in the cost of works into your valuation?
- I looked at BCIS and ensured that I got a full understanding how the subject property was at the valuation date. The comparables which were in better condition was showing a higher value was the reason for inspection.
East Finchley - What else did you factor into your valuation?
- Condition of the subject at the valuation date
- Size
- Location
East Finchley - How did you address the value looking low?
- I arranged an inspection to see what condition the subject proeprty was in. Based on the facts that cosntruction work took place post valuation date, I had to look at BCIS to see the costs to bring the property into a reasonable condition.
East Finchley - how did you appraise the returned valuation?
- I looked at comparable evidence and during my desked based review I was of the opinion that the returned value looked very low. I arranged an inspection and on inspection I noticed work has been carried out after the valuation date. I then sought out further evidence from the executor to get a better understanding of the condition at the valuation date. Then by utilising BCIS I was able to workout the rough costs for the work to get to a valaution.
East Finchley - Why did you think the value was too low?
- When looking at comparable evidence on the street and surrounding areas, the returned value seemed too low.
East Finchley - How did the condition of the property impact upon value?
- Based on the facts that at the valuation date the property was in poor condition, works would need to be done to align the property with the comaprables evidence. Therefore a lower value was accepted based on the condition
East Finchley - Explain how your inspection informed your recommendations.
- Based on my inspection, I spoke to the executor about how the property was at the valaution date and exactly what works took place.
- I asked the executor to send photographs of the proeprty from the valaution before the construction took place in order for me to get a better understanding of the condition.
East Finchley - How did you use BCIS?
- I filtered down to look at the costs of refurbishing a property and from that I was able to get an understanding of the correct value to adjust.
Finchley Central - what did you note regarding the poorer condition of the property?
- Following the guidance of VPGA 8 I followed the inspection template noting all the Characteristics of the locality, Of the property, construction, State of repair, fixtures, fitting and improvements.
Finchley Central - Why did you not adopt IPMS?
- We because all our comps are measured to GIA so to ensure consistency
- We measure the same
- We are asked for valuation advice and not asking for measurements
- I ensure I take enough measurements to get both measurements.
Finchley Central - what did you note regarding the poorer condition of the property?
- I noted down that the property was in need of modernisation
- Penetrating damp
Finchley Central - How did you reflect this in your valuation?
- I looked at comparable evidence and considered the costs of work to bring the property into a reaosnble standard and was able to make the necessary adjustments.
Finchley Central - Explain your application of the Wight v Moss case.
- Based on the facts that one of the owners were In occupation of the property the ruling for a 15% discount to be applied holds for this case
Finchley Central - Why did you value as a whole and then make a 50% deduction?
- In order to get a 50% value we need to work out the 100% value
Stoke Newington - What did you assume in terms of prudent lotting, and why?
- I looked at the potential to see if converting the property into 2 flats would it achieve a higher sale price in total as IHTA 1984 considers prudent lotting
Stoke Newington - how did you take into account hope value and prudent lotting?
- Based on the fact that the property a few down the road had planning permission to convert the house into 3 flats would suggest prudent lotting.
- For the subject the property could be converted into 2 flats
- So the consideration of what would yield the highest price has to be considered
Stoke Newington - How did you value the flats?
- I used the comparable method to look at sale evidence for both houses and flats to see what would acheieve the highest price
- I valued the property as a house
Stoke Newington - What does the IHT Act say about both of these?
- Inheritance Tax Act 1984 says me must consider special purchasers and flooding of the market
