When buying a property with someone else, whether a spouse, partner, family member, or friend, it’s crucial to understand how you’ll legally own the property. The way in which your ownership is structured can significantly affect your estate planning, inheritance rights, and tax position.

In England and Wales, the two main ways of jointly owning property are Tenants in Common and Beneficial Joint Tenancy. While they may seem similar at a glance, they differ in important ways. Choosing the right option can help protect your assets, support your loved ones, and align your property with your long-term financial goals.

Below, we explore both in more detail, looking at how each works, their advantages, and potential drawbacks.

Beneficial Joint Tenancy

In a Beneficial Joint Tenancy, both owners are treated as owning the whole property together. There are no individual shares, each person owns 100% of the property jointly. If one of the owners dies, their interest in the property automatically transfers to the other owner, regardless of what is written in their Will. This automatic right of survivorship means the surviving owner becomes the sole legal and beneficial owner of the property immediately.

This arrangement is most commonly used by married couples or civil partners, especially when their intention is for the surviving partner to inherit the property without complication or delay.

Advantages:

• Right of Survivorship: When one owner dies, their interest in the property instantly passes to the surviving owner(s). This can make things simpler and quicker during a difficult time.
• No Probate Delay: The survivor can take full ownership without waiting for probate to be granted.
• Ideal for Unified Ownership: Useful where both parties intend to treat the property as a shared asset, without any division.

Considerations:

• No Control Over Inheritance: You can’t leave your share to anyone else, even if your Will says otherwise.
• Not Suitable for Unequal Contributions: If one person paid more towards the purchase or deposit, this isn’t reflected; each person is treated as owning the same amount.
• Inheritance Tax (IHT) Planning Is Limited: You can’t ring-fence a share of the property to protect it for children or future generations, especially in second marriages or blended families.

Whilst this article focuses on property, bank accounts or investments, which are owned by two or more people, will generally be held on a Beneficial Joint Tenancy basis.

Tenants in Common

With Tenants in Common, each person owns a specific, separate share of the property. These shares can be equal, such as 50/50, or reflect the amount each person contributed, like 70/30 or another proportion. This type of ownership gives each person the ability to leave their share of the property to someone else in their Will, such as children or other family members. Unlike Joint Tenancy, there is no automatic right of survivorship, so your share does not automatically pass to the other owner when you die.

Instead, your share becomes part of your estate and is dealt with according to your Will or intestacy rules (if no Will exists). This setup is popular among unmarried couples, business partners, friends buying together, or people in second marriages who wish to protect their children’s inheritance.

Advantages:

• Flexible Ownership Shares: Reflects actual contributions, which is particularly useful when one party has put in more of the deposit or ongoing payments.
• Personalised Inheritance Planning: Each party can pass their share on to children, family, or trusts, or other strategies which are helpful in estate and tax planning. For example, you can specify in your Will that the survivor can be given a life tenancy within a Will to stay in the property with the share then passing to nominated beneficiaries on second death or after a specified period of time.
• Protecting Family Interests: Especially beneficial in blended families or where owners want to ensure children from previous relationships are provided for.
• Supports Asset Protection Strategies: For example, placing your share in a trust can help ring-fence it from future care fees or remarriage complications.

Considerations:

• No Automatic Succession: Your share doesn’t pass automatically to your partner on death, this can cause delays unless a Will is in place.
• Potential for Conflict: If one party wants to sell and the other doesn’t, it can create legal and financial disputes.
• More Complex Estate Administration: On death, probate will be needed to transfer ownership of your share, which can add time and cost.

The following table summarises some of the key features of the two approaches side by side:

Feature	Beneficial Joint Tenancy	Tenants in Common
Ownership Split	Equal for all parties	Flexible – can reflect contributions
Right of Survivorship	Yes – automatic on death	No – passes under Will or intestacy
Needs a Will?	Recommended but not essential	Essential to control who inherits
Ideal for	Married couples with aligned goals	Unmarried couples, blended families
Estate Planning Flexibility	Limited	High
Inheritance Tax Planning	Less control	More options available
Requires Probate?	Usually not on the first death	Yes, for the deceased’s share

Which Option Should You Choose?

Choosing the right structure depends on your personal, financial, and family circumstances. Ask yourself:

• Do you want your share of the property to automatically pass to your partner, or to someone else, like your children?
• Have you contributed unequal amounts to the purchase?
• Are you planning to do any estate or inheritance tax planning?
• Do you want to protect assets from care fees or remarriage claims after death?

For many married couples with aligned financial goals, Joint Tenancy is simple and efficient. However, Tenants in Common can offer far greater control, protection, and flexibility, especially in more complex family or financial situations.

How We Can Help

At Henwood Court, we understand that property ownership is more than just a legal technicality; it’s a cornerstone of your long-term financial wellbeing. Whether you’re purchasing your first home, planning for retirement, or thinking about passing wealth to the next generation, we can offer support in choosing the ownership structure that best fits your circumstances and future goals.

We’ll also work closely with your solicitor to ensure your decisions are reflected in the right legal documents, such as a Declaration of Trust or an up-to-date Will.