Being named executor of a deceased estate is a responsibility most people take on during one of the most difficult periods of their lives. Alongside the emotional weight of losing someone, you are managing a legal and financial process with real consequences for the beneficiaries depending on you to get it right. When the estate includes property, whether a family home in the Hills District, an investment apartment in Parramatta, or a commercial premise on Sydney’s North Shore, establishing what that property was worth, and when, is one of the first practical decisions you need to make.
This guide explains when a deceased estate property valuation is required in New South Wales, why the date of death matters so much, how the valuation connects to capital gains tax and transfer duty, and what executors need to understand before they commission a report.
Summary
This guide covers when a deceased estate property valuation is legally required or practically essential; why the date of death is almost always the relevant valuation date; how the valuation affects capital gains tax calculations, including the two-year main residence exemption; and what happens to transfer duty when beneficiaries vary the distribution from what the will specifies. A real scenario illustrates how commissioning an independent valuation early protects executors and beneficiaries alike.
What a Deceased Estate Property Valuation Is and When You Need One
A deceased estate property valuation is an independent assessment of the market value of a property owned by someone who has passed away, prepared as at the date of their death. It is not the same as a general market appraisal and not the same as a sale price estimate. It is a formal report prepared by a Certified Practising Valuer accredited with the Australian Property Institute, dated to a specific past date, and structured to satisfy the ATO, the NSW Supreme Court, Revenue NSW, and the solicitors or accountants managing the estate.
Deceased Estate Property Valuation — What It Means
A deceased estate property valuation establishes the market value of a property at the date of the owner’s death. This figure is used as the cost base for capital gains tax, as evidence in the probate application, and as the basis for any transfer duty assessment where the distribution departs from the will.
Not every property in every estate requires a formal valuation, but most do. The table below sets out the main situations where one is either legally required or practically essential.
| Situation | Why a Valuation Is Required |
| Applying for a Grant of Probate | The NSW Supreme Court requires evidence of estate asset values as part of the probate application |
| Capital gains tax calculation | The ATO uses market value at the date of death as the cost base when the property is later sold |
| Distribution among beneficiaries | An independent valuation gives all parties an agreed figure, reducing disputes over how assets are divided |
| Transfer duty where distribution varies | Revenue NSW requires a valuation when the property is not transferred strictly in conformity with the will |
| Beneficiary disputes | An independent report from a Certified Practising Valuer is the most reliable way to resolve disagreements about value |
Why the Date of Death Is Always the Starting Point
The effective date of the report is almost always the date of death, not the date probate is granted, not the date the property is sold, and not the date the valuer inspects it. This matters for two reasons.
First, the ATO’s cost base rules under the Income Tax Assessment Act 1997 establish that where a property passes to a beneficiary from a deceased estate, the first element of the cost base is the market value at the date of death. Second, the NSW Supreme Court’s probate requirements and Revenue NSW’s evidence guidelines both refer to value at the date of death as the relevant figure for estate administration.
Legislation Reference Under Section 128-15 of the Income Tax Assessment Act 1997, where a property is acquired by a beneficiary from a deceased estate, the first element of the cost base is the market value at the date of death. This figure, established by an independent qualified valuer, becomes the starting point for any future capital gains tax calculation when the beneficiary sells.
Can the Valuation Be Done After the Date of Death
Yes, and this is standard practice. A valuer does not inspect the property on the day someone passes. They form an opinion of what the property was worth on that date using market evidence from that period. This is called a retrospective valuation and is accepted by the ATO and Revenue NSW even where several years have passed. That said, commissioning the valuation earlier in the estate administration process is always the better approach.
Capital Gains Tax and the Two-Year Window on the Family Home
CGT is where executors and beneficiaries are most commonly caught out, particularly on properties that were the deceased’s main residence.
The Main Residence Exemption
Under the ATO rules for inherited property and CGT, a full exemption may apply where the estate or beneficiary disposes of the dwelling within two years of death, or within a longer period allowed by the Commissioner, subject to the applicable eligibility conditions. If the property is held beyond the two-year window, CGT applies to the gain from the market value at date of death to the eventual sale price. This is exactly where the deceased estate property valuation becomes critical, since it establishes the starting point for that calculation.
Investment Properties
Where the property was not the deceased’s main residence, such as an investment apartment in Surry Hills or a retail premises in the Eastern Suburbs, no exemption applies. The entire gain from the date of death value to the sale price is potentially taxable. Accuracy in the valuation matters from the first day.
Real scenario: Margaret was appointed executor of her mother’s estate, which included the family home in Summer Hill purchased in 1988. Her solicitor advised that CGT would not apply if the property was sold within two years, since it had been her mother’s main residence. However, the solicitor also explained that if the property was transferred to one of the three beneficiaries, the deceased estate valuation would establish the cost base for any future gain. Margaret commissioned the valuation. The property was transferred to one beneficiary who bought out the other two at the independently established value. Without the report, three siblings would have been negotiating the buyout figure among themselves, which her solicitor noted was exactly how deceased estate disputes began.
Transfer Duty and the Rule Executors Often Miss
For most deceased estate transfers, a concessional duty rate of just $100 applies under Section 63 of the Duties Act 1997, but only when the property is transferred strictly in conformity with the will. The moment beneficiaries agree to vary the distribution, even informally, the concessional rate no longer applies to the portion that has been varied, and standard transfer duty is assessed on that share at market value.
| Transfer Type | Duty Rate | Valuation Required? |
| Transfer exactly as per the will | $100 concessional | No, unless Revenue NSW requests it |
| Distribution varied from the will by agreement | Standard duty on varied portion | Yes, on the market value of the property |
| One beneficiary buys out another’s share | Standard duty on buy-out amount | Yes, independent valuation required |
Revenue NSW publishes its evidence requirements under Revenue Ruling DUT 012, and the deceased estate transfer concession is detailed under Ruling DUT 046. Where the distribution is varied, an independent valuation from a Certified Practising Valuer is the standard evidence Revenue NSW expects. Confirming the intended distribution with the solicitor before any variation is agreed avoids an unexpected duty bill.
What to Tell the Valuer When You Instruct Them
Getting the right report depends on giving the valuer accurate instructions upfront. When you make contact, provide the following.
- The property address and the date of death, since this is the effective date and cannot be changed once the report is issued
- The purpose of the valuation, whether probate, CGT, transfer duty, or a combination, since this affects how the report is structured
- The certificate of title or lot and deposited plan number, if available
- Any relevant details about the property, such as a tenancy, recent renovation, or unusual features that may affect value
- Whether there are multiple beneficiaries involved, since fractional interests or comparative values may need to be addressed
Most deceased estate valuations for standard residential properties across Greater Sydney, from the Northern Beaches and the North Shore to the Sutherland Shire, the Hills District, and the Inner West, are completed within three to five business days of the property inspection.
Conclusion
A deceased estate property valuation is a legal document that affects probate applications, capital gains tax calculations, transfer duty assessments, and the relationships between beneficiaries who need to trust the process. Getting the date right, instructing a qualified independent professional, and understanding how the figure interacts with NSW legislation are the three things that matter most to an executor.
Commissioning the valuation early, with a clear brief on purpose, puts every party in a significantly stronger position.
Frequently Asked Questions
What date is used for a deceased estate property valuation?
The market value is assessed at the date of death, not the date of inspection or probate grant. This applies whether the valuation is commissioned immediately or several years later.
Is a real estate agent appraisal good enough for probate?
No. An agent appraisal is an informal opinion and is not accepted by the NSW Supreme Court, the ATO, or Revenue NSW. A formal report from a Certified Practising Valuer is required.
Do I need a valuation if the property transfers exactly as per the will?
Not necessarily for transfer duty, since the $100 concessional rate applies to transfers strictly in conformity with the will. However, a valuation is still advisable for future CGT purposes.
Can a deceased estate valuation be done retrospectively?
Yes. A certified practising valuer can establish value at a past date using historical sales evidence and market records. This is standard practice accepted by the ATO and Revenue NSW.
What happens if beneficiaries vary the distribution from what the will states?
The $100 concessional duty rate ceases to apply to the varied portion, and Revenue NSW assesses standard duty. An independent valuation is required to establish the market value for that assessment.
Does inheriting a property trigger CGT?
No. CGT applies only when the property is later sold. If it was the deceased’s main residence and sold within two years, the gain is generally exempt. After two years, CGT applies on the gain from the date of death value to the sale price.
Can one valuation report serve multiple purposes?
Often yes. A single report dated to the date of death can support probate, the ATO cost base, and transfer duty assessment, provided the valuer is told all intended purposes upfront.
Need a deceased estate property valuation in Sydney or NSW? Sydney Property Valuers prepares independent, API-accredited deceased estate valuation reports for probate, CGT, transfer duty, and beneficiary distribution across Greater Sydney; the Macarthur region, including Campbelltown, Camden, Narellan and Gregory Hills; and all of NSW.
Call (02) 9099 9137 or visit sydneypropertyvaluers.com to request a quote.