Value My Antiques, Collectables, and Vintage Jewelry?

There are several types of valuation which may be5) Capital Gains Tax
given for an antique or a piece of precious jewellery.Capital Gains tax is payable on the sale of certain
A valuation is more than assessing the monetaryassets when you gain more money for the item than
value of an item. It covers describing an item,was paid for it. For example you buy a piece of
appraising it and assigning a monetary value. It is onlyjewellery for £8000 and sell it 5 years later for
possible to arrive at a monetary value when you£11,000 then there is a Capital Gain of
have considered the other factors of the valuation.£3,000.
A professional valuation will have all the aspects givenCapital Gains tax is only payable on items of
in writing and will include : the date, the name &Jewellery individually valued at £6000 or more
address of the business carrying out the valuation,and an individual can currently make £8800 in
the purpose of the valuation (see below) , thecapital gains per annum before the tax is payable.
description, the appraisal, the monetary value and theThe value would be based on a balance between
valuers signaturecurrent auction prices and current retail price
The description covers the physical properties of an6) Family Division & Divorce
item eg Its size and weight, what materials it is madeThis is where assets need to be valued when an
of and any manufacturers or hallmarks.estate is split under divorce proceedings. The
The appraisal covers less tangible factors such asmonetary value is similar to the value assigned at
rarity, and quality. Condition will also be taken intoProbate.
account.People often wonder why do the amounts given in a
There are several types of valuation. The descriptionprobate valuation differ so much from those given
and appraisal remain the same for all types; it is thefor the same item on an Insurance valuation?
monetary value which changes according to the typeA Probate valuation is based on the figure that an
of valuation. The type of valuation given will dependitem is likely to achieve at auction. The Insurance
on the purpose the valuation is required for.valuation is usually based on the retail price.
The types of valuation are:The price a piece of achieves at auction is usually less
1) Insurance replacement.than the retail price especially as antiques are
This is the most common type of valuationfrequently purchased by dealers for resale.
undertaken by Antique Dealers & Jewellers. It isFor example:
required by insurance companies if an item has been- If a piece of Jewellery achieved £100 at
lost, stolen or damaged and the customer is makingauction the purchaser will pay a % on top of the
an insurance claim. An insurance replacement valuationprice to the auctioneer. This % varies between 10
may also be required by insurance companies beforeand 25 % depending on the auction house. The total
they will cover a high value item. The monetary valuepaid eg auction price plus the commission is the
assigned in this type of valuation is based on theamount the purchaser pays
current retail price charge by a jeweller including VAT.- Items sold at auction is frequently sold to dealers
This will usually either be a NRV (New Replacementwho wish to sell on the item for a profit. In order to
Value) usually used for items under 50years old orachieve a profit they will need for the hammer price
SHRV (Second Hand replacement Value) for itemsplus the commission to be well below the retail price.
between 50 and 100 years old or ARV (AntiqueThe dealer will base the price paid he is willing to pay
Replacement value) for items over 100 years old.for the item at auction at the price he reasonably
If an item is relatively rare and not likely to beexpect to sell the item for minus the cost paid for
available from an antique dealer, auction house orthe item and also minus the cost of bringing that item
jeweller, the monetary value can be based on theto sale. Costs of bringing the item to sale will include
cost of re-creating the item. This is known as therepair and cleaning costs for the item and also sum
Facsimile Value or FVtowards the overheads of running the business
2) Private Sale- A dealer turning over more than £67,000 a
This is the amount a customer will receive if theyyear needs to include VAT in the price of an item.
wish to sell the item to another private person. ThisSo lets assume that a jeweller buys a diamond ring
value would be somewhere between the price afor £100 at an auction where they pay 15%
jeweller would pay for it and what they would sell itcommission. The Jewellery hands over £115
for - this value would benefit both the buyer andand takes the ring back to his shop where a tiny
seller in a private trade.repair is carried out to one of the claws to ensure
3) Probatethe diamond is held firmly and the ring is cleaned so
Value for Probate is known as 'Confirmation of Will' inthat it looks its best in the window. Including the time
Scotland. It is the monetary value assigned tospent on the cleaning and repair the Jeweller had
deceased persons items. This is the value the item isnow invested £150 in the ring. He normally
likely to fetch if offered on the open market on theworks on a 25% profit margin and so needs to
date of the persons death. Frequently this will be there-coup £180. In order to recoup £180,
price it would fetch at auction and this isthe jeweller must add tax on taking the price to
consequently lower than the insurance valuation.£206.80. A likely retail price will be at least
4) Loan Security.£210 (or more if the jeweller believes that the
The value that a Pawnbroker or other institutionring is worth more).
would put on an item offered as security against aI hope this little guide helps - please keep checking
loan. The level fixed would not be higher than theback for more.
probate valuation.