How to calculate the value of real estate for succession
When the time comes for succession planning, one of the most important decisions to make is how to value your real estate.
This can be a difficult process, but with a well-done calculation you can get an accurate estimate of the value of your property. In this blog post, we will guide you through the steps necessary to calculate the value of your real estate for your estate plan.
How to get an accurate property valuation for an estate plan
The first step is to determine the fair market value of your property. The best way to do this is to hire a professional appraiser.
An appraiser will consider factors such as the location of your property, its condition and recent comparable sales in the area. Once the fair market value of your property has been determined, the next step is to gather all the information necessary to properly determine the value for probate purposes.
This includes the purchase price of the property, any improvements that have been made, the current market value and any easements or encumbrances that may lower the value of the property.
With this information in hand, you can start calculating the value of your real estate.
The first thing to do is to subtract any outstanding mortgages or liens on the property from the current market value. Next you can subtract the purchase price of the property from the current market value to get the capital gain or loss on the property. Finally, you can add or subtract the improvements that have been made to the property. This will give you the final value of your real estate for succession planning purposes.
While this process may seem daunting, it is important to get an accurate valuation of your property. With a little time and effort, you can ensure that your estate plan reflects the true value of your assets.
Inheritance taxes: what they are and how they work in Switzerland
Inheritance taxes are taxes imposed on the transfer of property upon the death of the owner.
The tax is calculated based on the value of the property and rates vary from jurisdiction to jurisdiction.
In most cases, the tax is payable by the executor or administrator of the estate. Inheritance taxes are often used to finance public services, such as education and infrastructure.
In some jurisdictions, inheritance taxes are exempt for certain types of property, such as homes or businesses. In others, some family members may be exempt from paying the tax. For example, in some jurisdictions, a spouse or child may not have to pay inheritance tax.
In Switzerland, inheritances are taxed (from the 1st degree) and the tax is usually paid by the heirs and collected by the cantons.
For the purposes of inheritance tax, in the case of real estate, the canton in which the property is located is authorised to levy the tax and the heirs are taxed for their respective share of the estate.
Conclusion
Calculating the value of real estate for inheritance is not a complex procedure, but it does involve several checks for which it is always advisable to consult a professional, be it an expert or an estate agency. Also not to be underestimated is the role of taxes, which are due in Switzerland and which, depending on the value of the estate, can have a significant impact on the final value of the assets bequeathed.
