Welcome to the fifth in a new series of articles from the SWW Technical Team; Common Questions in our Inbox. For this instalment, let’s talk about severance of joint tenancy.
Before we go into this further, let’s start from the basics and look at what it means to hold a property as joint tenants or tenants in common.
If you hold your property as joint tenants with another person, this means that both owners own 100% of the property, not a divided share. You have equal rights to the whole property, and if the property is sold you will each be entitled to an equal share of the proceeds.
A joint tenancy creates rights of survivorship. The result is that when one owner dies, the remaining owners will automatically own the whole property. This means that a joint tenant cannot gift their interest in the property to anyone by their Will.
Tenants in common
If you hold your property as tenants in common, you will each have a divided share in the property. This is often an equal share, but it is also possible to hold the property in unequal shares. This is an attractive option for people purchasing a property together and contributing different amounts towards the deposit.
Under a tenancy in common, each owner can deal with their share in the property separately, allowing them to gift their share to their own beneficiaries by their Will.
How can I find out how my home is held?
You can download a copy of the title register from the Land Registry website which will confirm how you hold your property. This will cost you £3.
Why is there nothing appearing for my property on Land Registry?
It may be that your home is unregistered in which case you should see a conveyancer to have the property registered.
Can I change from joint tenants to tenants in common?
Yes you can.
How do I sever the tenancy?
To sever the title so the home is held as tenants in common, a notice of severance would need to be completed and signed by all the owners. This evidences your intention to own the property as tenants in common.
A SEV form would also be completed and sent to the land registry who will then update the title register. There is no fee to sever the tenancy.
To ensure this is completed correctly please speak to your estate planner who can put these documents in place for you.
What are the benefits of severing my tenancy?
Aside from having the ability to gift the share of the home to whom you wish, you can also place your property in trust so if you wanted to pass your home to your children but have X benefit from the home while they are alive, you are able to do this. Please see our article on property trusts here.
Placing the property in trust provides the assurance that your share of the property will ultimately go to your beneficiaries even if the survivor changed their will after your death.
Can the property be severed in unequal shares?
Yes. If the property is to be held in unequal shares, we would advise you seek legal advice as a document known as a declaration of trust will need to be drawn up to evidence the unequal shares owned in the property.
What happens if I die before the land registry title is updated?
As long as the notice of severance has already been signed, this evidences your intention to hold the property as tenants in common.
If, however, no notice of severance was signed before you pass away, the property would still be deemed to be held as joint tenants and therefore the deceased’s share would automatically pass to the surviving owner.
Do all owners have to agree to sever the title?
No. There may be a situation where a home is owned jointly by husband and wife. However, they are no longer on talking terms and the wife wishes to sever the tenancy. This can be done and is referred to as a unilateral severance.
In this case, the wife would need to serve a written notice of the change (notice of severance) on her husband, complete the SEV form, prepare any supporting documents and send it all to HM Land Registry’s Citizen Centre. The supporting documents would be a letter certifying that she has given the notice to her husband or left it at his last known home or business address (if he has one) in the UK.
She would also need to confirm how the notice was served.
You should discuss severance of tenancy as part of your estate planning with a professional.