Joint Tenancy vs Tenancy in Common: What is the Difference?
3 minute read
How you own your home jointly can have a significant impact on your estate planning, your inheritance tax position, and the security of your family's future.
When two or more people buy a property together, they have to make a decision that most people give very little thought to at the time. That decision determines how they will own the property together legally.
There are two ways of doing this. One is called a joint tenancy. The other is called a tenancy in common. Despite sounding similar, these two arrangements work in fundamentally different ways, and the distinction between them can have a significant impact on what happens to your share of the property when you die.
Understanding which arrangement you have, and whether it is still the right one for your current circumstances, is one of the more important aspects of sensible Will-making.
Table of Contents
What is a Joint Tenancy?
A joint tenancy is the most common way for a couple to own property together, and for straightforward situations, it can work very well. Under a joint tenancy, the co-owners do not each hold a defined percentage share of the property. Instead, they collectively own the whole of it together. There are no separate portions, no stated percentages, and no divided interests.
The key legal feature of a joint tenancy is the right of survivorship. When one co-owner dies, their interest in the property does not pass through their estate. It does not form part of what they leave behind. Instead, it automatically transfers to the surviving co-owner or co-owners by operation of law. This happens regardless of what a will says, and regardless of whether the deceased even had a will at all.
In practical terms, if you own your home as joint tenants with your spouse and you die first, your spouse simply becomes the sole owner of the property. No grant of probate is required for the property itself; no transfer needs to be organised, and the process is relatively straightforward from an administrative point of view.
For a younger couple buying their first home together, with no children from previous relationships and no immediate concerns about inheritance tax or care fees, a joint tenancy is usually entirely appropriate. It is simple, it keeps things clean, and it means the surviving partner is not left in any doubt about where they stand.
However, the simplicity of a joint tenancy comes with a trade-off. Because your interest in the property does not form part of your estate, you have no control over where it ultimately ends up. You cannot direct it to your children in your will. You cannot place it into a trust. Once you die, the right of survivorship takes effect automatically, and your share passes directly to the surviving owner regardless of your wishes.
What is a Tenancy in Common?
A tenancy in common is different in one fundamental way. Under a tenancy in common, each co-owner holds a defined, separate share of the property. That share belongs to them individually, and they are free to deal with it as they wish.
The most common split is 50:50, which is how most couples choose to divide ownership. But it does not have to be equal. Co-owners can hold shares in any proportion that reflects their circumstances, for example, 60:40 or 75:25, depending on what they each contributed to the purchase or what they have agreed between them.
Crucially, when one co-owner dies, and there is a tenancy in common, the right of survivorship does not apply. The deceased person’s share does not automatically pass to the other owner. Instead, it forms part of the deceased’s estate and is dealt with in accordance with their will, or, if they did not have a will, under the rules of intestacy.
This means that under a tenancy in common, each co-owner can leave their share of the property to whoever they wish. They have full control over what happens to their share after they die.
Why Does Tenancy in Common Matter for Estate Planning?
The ability to direct your share of a property through your will opens up a range of planning possibilities that simply are not available under a joint tenancy. There are three areas in particular where tenancy in common can make a meaningful difference.
Protecting Your Share for Children or Other Beneficiaries
If you own your home as joint tenants and you die first, the entire property passes to your spouse automatically. Your spouse then owns everything outright. They are free to change their own will, to remarry, or to make different decisions about the property in later life. Your children or other intended beneficiaries have no guaranteed entitlement to anything.
Under a tenancy in common, you can leave your share of the property to your children directly, or, more commonly, into a trust that allows your surviving spouse to continue living in the property for the rest of their life. When your spouse eventually dies, your share then passes to the children you originally intended to benefit. Your spouse is protected, and so are your children.
Inheritance Tax Planning and the Residence Nil-Rate Band
Inheritance tax planning is a reason why some couples, particularly those with more substantial estates, choose to hold property as tenants in common rather than joint tenants.
One specific area where this matters is the residence nil-rate band. This is an additional inheritance tax allowance that can apply when a residential property is passed to direct descendants, such as children or grandchildren. The rules around this allowance are specific, and there are circumstances where the structure of your property ownership can affect whether and how you are able to make use of it.
Holding your property as tenants in common, and directing your share to your children through a carefully drafted will, can in some circumstances help to preserve or maximise the use of this allowance across both spouses’ estates.
Protecting a Share of the Property Against Care Fee Means-Testing
Care home fees are a concern for many families, and the cost of residential care in England can be substantial. When a local authority assesses whether someone needs to contribute to the cost of their care, they carry out a means test that takes into account the person’s assets, including their interest in any property they own.
If your property is held as a joint tenancy and your spouse dies before you, the whole property passes to you automatically and forms part of your assessed estate if you later need care. However, if the property is held as a tenancy in common and your spouse’s share passes into a trust under their will, that share is not owned by you outright. This may affect how it is treated in a means assessment, although this is a complex area and the rules require careful consideration.
The important point is that holding property as tenants in common, combined with appropriate will planning, gives you options that a joint tenancy does not.
What is Severing a Joint Tenancy?
If you currently own your property as joint tenants but you would like the benefits of a tenancy in common, you do not need to sell or remortgage. You can simply sever the joint tenancy.
Severing a joint tenancy is the legal process of converting it into a tenancy in common. Either co-owner can do this unilaterally, meaning you do not need the consent of the other owner. The process involves serving a written notice of severance on the other owner, and the change takes effect from the point of service. Once severed, the joint tenancy becomes a tenancy in common, and each owner is treated as holding an equal share unless there is evidence of a different arrangement.
It is important to be aware that severing a joint tenancy does not by itself resolve your estate planning. Once the property is held as a tenancy in common, you will need a will that deals with your share appropriately. Without a will, your share will pass under the rules of intestacy, which may not reflect your wishes at all.
Severance is a straightforward process in most cases, but the decision to sever should not be taken lightly. If you and your partner are not in agreement, or if there are complicating factors such as a mortgage or a dispute over the size of each person’s share, it is sensible to take professional advice before proceeding.
Should You Sever Your Joint Tenancy?
This is a question that depends entirely on your individual circumstances. For a younger couple with a modest estate, no significant tax concerns, and no children from previous relationships, a joint tenancy may remain entirely appropriate. There is no one-size-fits-all answer.
However, if any of the following apply to you, it is worth taking the time to review your property ownership and your will together:
You have children from a previous relationship, and you want to make sure they are ultimately protected.
You are concerned about what would happen to your share of the property if your partner were to remarry or change their will after you die.
Your combined estate is potentially subject to inheritance tax, and you want to make sure you are making the most of the allowances available to you.
You are approaching the age at which care costs might become a realistic concern in the medium term.
You hold a significant share of your wealth in your home, and you have not reviewed how it is owned for some time.
In all of these situations, the way you hold your property and the terms of your will are closely connected. Getting one right without the other is rarely enough.
How We Can Help
Whether you are considering severing a joint tenancy, setting up a life interest trust in your will, or simply reviewing your estate planning arrangements for the first time, the starting point is always a clear understanding of your current position and what you want to achieve.
Our will-drafting service is designed to make that process straightforward. We take the time to understand your circumstances, explain your options in plain English, and produce a will that does exactly what you need it to do.
If you would like to discuss your situation or find out more about how we can help, you can contact us directly to speak with one of our will specialists.
Quick Comparison: Joint Tenancy vs Tenancy in Common
| Joint Tenancy | Tenancy in Common | |
|---|---|---|
| Defined Shares | No | Yes |
| Does Right of Survivorship apply? | Yes - Automatically | No |
| Can be directed by Will | No | Yes |
| Can be left to children or a Trust | No | Yes |
| Can be converted to the other type | Yes – by severance | Yes – by agreement |
| Suitable for Estate Planning | Limited | Yes |
| Commonly used by… | Younger couples and straightforward situations | Those with more complex needs or tax concerns |
Frequently Asked Questions
What is the main difference between a joint tenancy and a tenancy in common?
Under a joint tenancy, co-owners collectively own the entire property with no defined individual shares, and when one owner dies, their interest passes to the surviving co-owner under the right of survivorship. Under a tenancy in common, each owner holds a defined share of the property, which forms part of their estate upon death and can be left to whoever they wish in their will.
Can I leave my share of a jointly owned property to my children in my will?
If you own the property as joint tenants, you cannot direct your share through your will. The right of survivorship means it passes automatically to the other owner. However, if you own the property as tenants in common, your share forms part of your estate, and you can leave it to your children or place it in a trust for their benefit in your will.
How do I find out whether I own my property as joint tenants or tenants in common?
You can check the title register for your property at HM Land Registry. If the register includes a restriction stating that no disposition of the property is to be registered without the consent of a specified person or trustee, this is a strong indication that the property is held as tenants in common. If there is no such restriction, the property is likely held as joint tenants. You can obtain a copy of the title register online via the Land Registry website for a small fee.
How do you sever a joint tenancy?
Severing a joint tenancy involves serving a written notice of severance on the other co-owner. Either owner can do this without the other’s consent. Once the notice has been served, the joint tenancy is converted into a tenancy in common, and each owner is treated as holding an equal share. You should also notify HM Land Registry so that a restriction can be entered on the title register, and update your will at the same time to reflect your newly defined share.
Does severing a joint tenancy require a solicitor?
You are not legally required to use a solicitor to sever a joint tenancy, but professional advice is recommended, particularly if you want to make sure the process is completed correctly and that your will is updated to reflect the change. Severing the joint tenancy without updating your will may mean your share passes under the rules of intestacy, which could produce a result you did not intend.
Can a joint tenancy be severed without the other owner's knowledge?
Yes. Severance can be carried out unilaterally, meaning one owner can sever the joint tenancy by serving written notice on the other, without requiring their agreement. The key requirement is that the notice must actually be served on the other owner. The change takes effect from the date of service.
Does changing from joint tenancy to tenancy in common affect my mortgage?
Changing the basis of your legal ownership from joint tenancy to tenancy in common does not in itself affect your mortgage. The mortgage remains a charge over the whole property, and both borrowers remain equally liable for it. However, it is always sensible to inform your mortgage lender of any changes to the property title and to take professional advice if you are unsure about the implications.
What happens if I own property as tenants in common and I die without a will?
If you die without a will, your share of the property will not pass to your co-owner automatically. Instead, it will pass under the rules of intestacy, which follow a fixed legal order of priority. Depending on your family situation, this might mean your share passes to a spouse or civil partner, or to children, or to other relatives. It may not produce the outcome you would have wanted. This is one of the most important reasons to make a will if you hold property as tenants in common.
Disclaimer
This article is intended as general information only and does not constitute legal advice. The information refers to the law of England and Wales. Tax thresholds and legal rules are correct at the time of writing but are subject to change. We recommend that you seek professional advice regarding your own circumstances.
Bio
This article was written by Stephen Rhodes. Stephen was called to the Bar of England and Wales in 1999 and brings over 25 years of in-house experience working with solicitor firms across the Manchester area, with a specialism in Wills and Probate. He now focuses exclusively on will drafting, helping his clients ensure their loved ones are taken care of exactly as they would wish.