Unsellable unlisted shares and probate

[noblegiraffe]

If a person dies and has unlisted shares that, when asked, the company has valued at thousands of pounds but the company will not buy them back and they are probably unsellable, how can the executor of the will deal with this when valuing the estate? What are the inheritance tax implications?

The shares are effectively worthless.

If you’re in IHT territory, pay someone to figure it out for you. They save you much much more than they cost you and will figure that out. Ultimately if they are unlisted they are worth what someone else will pay for them and with that in mind you’d be better off selling them than rolling the dice and getting HmRC to believe a valuation.
depending on the backstory here (do you desperately want to sell the shares? how do you feel about the company etc?) I might see if you can find a competitor of theirs to buy them, go back to the table with that information and you may find they magically want to buy them from you after all.

We had similar when an aunt of my Father's died leaving shares in a Yorkshire Cattle Market which her Father had been involved with..

I think the company were able to give us an approximation of what the price was last time shares changed hands and we had the option to offer them for sale through the company to other shareholders.

Not in IHT territory but if, during her lifetime, she'd needed DWP/LA help with Care Home Fees they'd have been a pain.

When administering her estate we just split them proportionately between the residuary beneficiaries. They pay a dividend of a hundred or two most years and every now and then there's a flutter of interest in them usually driven by politicking in Yorkshire's agricultural community.

I think these shares are unsellable, the company won't buy them back, they said we had to find our own buyer, and I can't see anyone wanting to buy them. So whatever the company says they're worth, really they're worth £0.

Why don't you think anyone will want to buy the shares?

Problem is you can’t sell shares without probate and you can’t get probate without first clearing IHT (whether or not you have to pay any tax.) You need a price for all the assets to work out the value of the estate to fill in IHT400.

Are they bearer shares or shares of a share class that has been removed in some way? Is the company a plc or a private limited company? More information is needed. You also potentially need to refer to the company's Articles of Association.

Because the company looks like a complete dud that will never make any money.

Ah, I've no idea. It's not me dealing with it, thankfully, so I don't know the full details.

You're not going to get answers here without providing more information. You can only publicly trade shares of a listed company in the UK. It sounds as though an employee has been awarded a grant of shares or an investor has been allotted shares in return for an investment. The fact that the company can't afford to buy the shares back doesn't make them worthless. Where an employee has a share award, the rules of the share scheme are needed to see what the rules are. It's very normal to grant share awards to incentivise employees.