Home ownership on death

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What happens to a home when someone dies if it’s jointly owned?

Homes are often owned jointly with the title deeds held under ‘Joint Tenancy’. This means that when the first owner dies their share of the property automatically passes to the surviving owner. This is usually set up in a ‘survivorship clause’ in the title deeds for the property. For most people this is ideal. Their share of the property goes to their spouse, civil partner or the person they own the property with.

However it’s not what everyone wants and this aspect of estate planning is often overlooked. It can result in payments of Inheritance Tax that could have been avoided.

Changing the title deeds

Fascinating fact: title deeds ‘trump’ the Will, so you can’t leave your share to someone else in your Will if that’s not in the deeds.

Both owners of the property have to complete the paperwork. In England and Wales this document is called a Severance of Tenancy. In Scotland it is an Evacuation of Special Destination.

The use of an Evacuation/Severance document changes the definition of the tenancy of the property from ‘Joint Tenants’ to ‘Tenants in Common’. Your home is still owned by both, however its value is split into two distinct, separate and equal parts, 50:50. This allows you to leave your share of the property in your Will.

There are 3 main benefits to establishing this separate ownership principle:

  1. Your share can be passed directly to your children or other beneficiaries rather than the surviving partner, with a possible saving in Inheritance Tax.
  2. You can organise your estate planning better.
  3. Once the Evacuation/Severance document is drawn up, you can allocate your share of the property in your Will. With a Final Fling ‘Will for Life’, you can change and update your Will easily as life changes.

Drawing up the paperwork

  1. Start by checking how the title is currently held. Your solicitor should be able to advise. If not, search the Land Registry Service online for the title. If you’re not able to do this online, you can write to the appropriate Land Registry office to ask them to perform a search. If you’d rather have help, contact us and we’ll put you in touch with an expert adviser. For online applications the paperwork is usually back within 24 hours. A paper application takes around 5 days.
  2. Check if there is a ‘survivorship clause’ in the title. If there is, see the Land Registry Service online to complete an Evacuation/Severance deed and a Land Registry form. Send these with the appropriate fee to the District Land Registry. They will update your title and send you confirmation of this.
  3. Write you Will. Use your Will to determine who should get your share of your jointly owned property.

Get professional help

If you hate forms or just have better things to do with your time, get a qualified person to do this for you. Contact us to reach an expert who can advise on the total cost before you go ahead.

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