Jewellery Valuation for Probate: Essential Tips for Accurate Appraisal

Valuing jewellery accurately during probate is crucial to avoid penalties from HM Revenue & Customs and ensure the correct inheritance tax calculation. Whether it’s a family heirloom or a modern piece, our guide will help you navigate the complexities of jewellery appraisal for probate purposes.

Amongst these assets, the valuation of jewellery can present a unique challenge, with precious gemstones, intricate designs and sentimental value all factoring into the equation.

Proper valuation can also help avoid disputes between beneficiaries if the jewellery is to be divided or shared. Our insights can help you follow the correct procedures and prevent the miscalculation of inheritance tax when valuing estate assets.

Why Is Cataloguing Jewellery for Probate Important?

During the probate process, jewellery is classed as a “chattel”, which refers to movable personal property or possessions. Chattels include furniture, vehicles and many other personal belongings (but they usually do not include items used in connection with a business).

As part of the probate process and the executor ensuring proper records are kept, a person’s chattels may be itemised and then distributed according to the instructions in their Will or, in the absence of a Will, according to the laws of intestacy. If there are no instructions in the Will for specific items, then the chattels can be sold or distributed amongst the Will beneficiaries, depending on the detailed Will provisions and the powers given to the executor.

Don’t Throw Anything Away

Firstly, you should not make any hasty decisions. If you feel like something isn’t worth anything, it is best to double-check and make sure you are not disposing of anything valuable. Particularly with personal belongings, an item can have significant sentimental value even if there is no monetary value. Even though something may not hold sentimental value to you, this may differ for other beneficiaries mentioned in the Will. Instead, collect all jewellery items owned by the deceased and document what you have.

Things to Look out for When Deciding If Something Is Worth Valuing

Although it can be hard for the untrained eye to pinpoint which items have more value than others, there are some tell-tale signs to look out for when figuring out if things have value or not:

• Regardless of style, size or gem setting, gold will always have value, even as scrap metal. The price it can get for scrap will depend on how many carats it is and its weight. To the untrained eye, it might be difficult to see how many carats it has, so we suggest going to a jeweller and asking for them to value it. If you find you need to personally value a large amount of gold jewellery, it might be worth buying a gold testing kit online.
• Silver hallmarks are official stamps on silver items that certify their purity and provide information about the item’s origin, maker, and age. In the UK, these marks include the Assay Office symbol, maker’s mark, standard of purity (e.g., “925” for sterling silver), and a date letter, all of which help authenticate and value the piece. If you find the item has other stamps on it, this could indicate where the item was made. Hallmarking in the UK dates back to the 14th century, making it one of the oldest forms of consumer protection. The system was established to prevent fraud and ensure that items made of silver were of the correct purity.
• The value of pearls is difficult to establish without detailed knowledge of the type and quality of the pearls.
• When trying to value a gemstone, pay attention to its setting; a gem encased in inexpensive settings like plastic or tarnished metal is less likely to be authentic. Furthermore, check the stone for subtle inclusions, as their presence suggests a naturally occurring gemstone — a magnifying glass or loupe may be helpful tools for this purpose.

If you are unsure about anything, we recommend speaking to a jeweller to ensure you know what every item is.

Do You Need an Expert Valuation?

You risk HM Revenue & Customs imposing penalties on you if you submit inaccurate value of assets. Depending on the circumstances, this can be up to 100% of the tax that would have been due had an accurate value been submitted. Unless you are sure the jewellery has no or only minimal value, an expert valuation is the best course of action. Only use your estimated values if you are sure your estimate is accurate.

What Happens When Getting Probate Valuations for Jewellery?

Probate usually requires valuing assets at their open market value, which is the price the item might reasonably be expected to fetch if sold in the open market at the date of death, less any liabilities that may be deducted.

This value differs from an insurance replacement value; the probate value is what you might expect to sell it for in an auction (ignoring auctioneer fees), and the insurance value is what you might have to pay to buy a brand-new similar item in a shop.

It is usually best to phone nearby stores and check if they do professional valuations of items for probate. We recommend calling up more than one shop to compare prices and timescales.

Once you have chosen your appraiser, you will get them to provide detailed written appraisals for each item for probate. If the item is valuable, these appraisals should include a description of the jewellery and photographs as well as their probate value. Make sure you have taken photos of the items before you hand them over so no item is forgotten.

Communicate with Beneficiaries

Communicate openly with beneficiaries regarding the distribution of the estate’s jewellery. In some cases, beneficiaries may choose to receive specific pieces instead of their cash equivalent. This also ties into the item’s sentimentality — some pieces of jewellery may have great emotional significance to other family members. You need to follow the Will provisions, so get professional advice if you are in doubt.

Related: Disputing a Will: A Legal Guide to Help You With a Difficult Process 

Gift Giving within Seven Years of Death

If the deceased gifted jewellery within seven years of their passing, then it must be declared and included in the probate process. Read more about gift giving on our blog post: Gifts and Inheritance: What You Should Know.

Should You Get Your Jewellery Valued When Writing Your Will?

Having jewellery valued when you write your Will can be a prudent step, especially if the items hold significant financial or sentimental value. Here are some reasons why this might be beneficial:

1. Accurate distribution of assets:

• Fair distribution: By having your jewellery valued, you can ensure the items are distributed fairly among beneficiaries. This is particularly important if you intend to leave jewellery to multiple people or if some pieces have a much higher value than others.
• Avoiding disputes: Clear valuations can help prevent disputes among heirs, as the value of each piece will be documented, reducing the potential for disagreements.

2. Clarity in your Will:

• Specific bequests: If you plan to leave specific items of jewellery to certain individuals, having an accurate valuation allows you to clearly state the value of these bequests. This clarity can help ensure your wishes are followed exactly as intended.
• Equalisation of inheritance: If you want to ensure that your beneficiaries receive equal shares of your estate, knowing the value of your jewellery allows you to balance these shares more effectively.

3. Accurate calculation of estate value:

• Inheritance tax considerations: Valuing your jewellery helps provide an accurate estimate of your estate’s total value, which is crucial for calculating inheritance tax. This can help your executor manage tax liabilities more effectively and avoid any penalties for underreporting asset values.
• Future-proofing: Jewellery can appreciate in value over time, so an initial valuation provides a baseline that can be adjusted later if necessary.

4. Peace of mind:

• Minimising stress for executors: Providing a clear, documented value of your jewellery can make the executor’s job easier, reducing the stress associated with probate.
• Preserving family harmony: Knowing you’ve taken steps to fairly and accurately distribute your assets can give you peace of mind and help maintain family harmony after you’re gone.

5. Insurance purposes:

• Protecting your assets: If you have valuable jewellery, an accurate valuation is essential for ensuring these items are properly insured. An accurate valuation can prevent financial loss if the jewellery is stolen, lost, or damaged before your Will is executed.

Conclusion

Valuing jewellery for probate requires precision and documentation to ensure the fair and accurate distribution of assets and to protect the executor from financial penalties. An informed valuation is also a means of preserving the legacy of the departed and helping to ensure fair and proper division where relevant. Working with professionals, maintaining clear records and considering both monetary and sentimental value are all essential aspects of this process.

Who We Are

With over a century of service to Sussex families, we understand each family is different. Recognising the uniqueness of every family and client, we tailor our legal services to your specific needs.

We are happy to share the probate work with the family and we often work on that basis. We do the technical paperwork, making sure all the assets are properly dealt with, debts are paid, and the probate application and inheritance tax calculations and allowances and returns to HM Revenue & Customs are properly dealt with. You might want to clear the property, deal with utility bills, and distribute items that have been left to individual beneficiaries. 

We will work with you to achieve the best division of what needs to be done so the estate is dealt with efficiently and as quickly as possible, keeping the legal fees down and minimising stress and worry for the family.

Alternatively, you may find yourself in a position where you need a more hands-on approach from us. We provide additional services, such as helping with funeral arrangements, collecting and distributing assets amongst the beneficiaries, and arranging the clearance and cleaning of the property. 

For more information, reach out to us: call us on 01273 604 123, email us at enquire@bbc-law.co.uk, or make an enquiry.