Declaration of trust & joint ownership

There are two ways in which property can be owned jointly, joint tenants or tenants in common. These terms have a different legal meaning to the type of tenant who rents a property from a landlord.

Joint Tenants

If you hold the property as joint tenants, both parties will own the whole of the property. You will not each have a quantified share in the property and will not be able to leave a share of the property in your will. If you sell the property, or if you separate, it will be presumed that you both own the property equally, regardless of your respective contributions to the purchase price. On the death of one co-owner, their interest in the property would automatically pass to the surviving co-owner without any further action. The surviving co-owner would then own the whole property and on their death it would form part of their estate. This is known as the “right of survivorship”.

Married couples or those in civil partnership commonly use this method of co-ownership because the right of survivorship makes it straightforward to inherit each other’s shares in the property.

However, there may be reasons why you would choose not to hold a property as joint tenants. For example, if one of you has made a large contribution to the purchase price of the property and you would want this to be recognized if the property is sold or if you separate. A joint tenancy is also not suitable if you have family from an earlier marriage and wish to leave interest in the property to them, instead of passing it to the co-owner. There may also be tax advantages of owning a specific share in the property and you should take appropriate advice in this regard prior to completing on your purchase.

Tenants in Common

If you hold the property as tenants in common, each of you will own a notional share in the property. Your shares may be equal, but they do not have to be. Your share of the property can be passed on to another person, either during your lifetime or under your will. If you do not have a will at the time of your death then your share will pass in accordance with the rules of intestacy.

If you wish to hold as tenants in common, then you should sign a declaration of trust. Holding the property as tenants in common may be appropriate if you have children from previous relationships and would prefer them to inherit your interest on your death rather than your co-owner. Holding the property as tenants in common in unequal shares may be desirable if you have made unequal contributions to the purchase price of the property.

Next Steps

Newcastle residential property expert solicitors Sintons Law discuss declaration of trust & joint ownership, including joint tenants & tenants in common

How you wish to hold the property must be your own decision and is something that you should keep under review following the purchase of the property. If you decide to hold the property as joint tenants but then wish to split your interests, the joint tenancy can be “severed” and turned into a tenancy in common at any time.

You also need to consider whether there is a mortgage on the property. If there is, then the trust deed should provide for this to be paid off before dividing the sale proceeds, or if one party is to be responsible for all or part of the mortgage capital payment out of their share then this should be stated in the trust deed, the trust deed should also go on to define the proportions in which the joint owners would make the mortgage payments.

As a further option you may wish to consider whether the document should contain a right of first refusal in the event of one party wishing to dispose of their share in the property. This is called a right of pre-emption. The arrangement would be that if one party wished to sell the property they would first give notice of this intention to the other parties who would have the right to buy that persons share at market value. It is important to specify now how you wish to hold the property, to avoid any uncertainty in the future.


By instructing Sintons you can be confident that we will handle your matter diligently, providing you with all the information you need to understand the process from start to finish.

If you require any further information please feel free to contact us.

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