Tenants in Common Explained | Shared Property Ownership Guide

When purchasing property jointly in the UK, buyers must choose between Joint Tenancy and Tenants in Common—two legal forms of co-ownership. Tenants in Common is a flexible arrangement that allows multiple individuals to own property together in unequal or equal shares, making it ideal for investment partnerships, unmarried couples, or family members pooling resources. This guide explains the key features, benefits, and considerations of owning property as Tenants in Common, and how Fraser Bond can provide expert guidance throughout the process.

What Does Tenants in Common Mean?

Tenants in Common is a legal ownership structure where two or more people own separate shares in a property. Unlike Joint Tenancy, which involves equal ownership and automatic survivorship, Tenants in Common allows for flexibility in ownership proportions and individual control over each person’s share.

Key Features:

• Ownership Shares: Each owner holds a specific share (e.g., 50/50 or 70/30), which can be defined based on contribution or agreement.
• No Right of Survivorship: If one owner dies, their share passes according to their will or the rules of intestacy, not automatically to the other owners.
• Independent Disposal: Each party can sell, gift, or bequeath their share (subject to agreement).

Why Choose Tenants in Common?

1. Flexibility in Ownership

Ideal for situations where co-owners contribute different amounts to the purchase price or mortgage. This can be formalised in a Declaration of Trust.

2. Estate Planning Benefits

Allows owners to leave their share to beneficiaries of choice, offering more control in inheritance planning.

3. Investment Partnerships

Suited for business partners or family investors, where parties seek defined returns on their property investments.

4. Tax Efficiency

In some cases, capital gains tax and inheritance tax planning can be optimised through this structure.

Considerations Before Choosing Tenants in Common

• Declaration of Trust: Highly recommended to set out ownership shares, maintenance responsibilities, and exit strategies.
• Mortgage Agreements: Lenders may require a joint mortgage; responsibilities for repayments must be agreed upon.
• Selling Your Share: Selling part ownership can be complex; co-owners may have first refusal rights.

How Fraser Bond Can Help

Fraser Bond offers expert guidance on property ownership structures, ensuring clients make informed decisions:

• Ownership Advice: Guidance on whether Tenants in Common or Joint Tenancy suits your goals.
• Legal Coordination: Working with solicitors to establish Declarations of Trust and ensure smooth transactions.
• Investment Planning: Structuring co-ownership for maximum return and risk management.
• Portfolio Services: Support for co-owned buy-to-let portfolios, including management and strategy.

With extensive experience in property acquisition, investment, and legal coordination, Fraser Bond ensures clients receive tailored advice and support throughout every stage of joint ownership.

Conclusion

Tenants in Common is a practical and flexible ownership structure that suits a wide range of buyers, from couples to investors. By allowing defined shares and independent control, it offers benefits in estate planning, taxation, and investment returns. Fraser Bond provides the expertise and resources to help clients navigate this process confidently and strategically.