Joint tenancy & Tenancy in common

joint tenancy in common

The Difference between Joint Tenancy and Tenancy in Common

I recently had an appointment with a client who had a new property and they asked if they needed to include it in their tax return. The client owned it with a sibling and that sibling lived in the house with their partner, while my client lived in another house.

joint tennacy tenancy in common“Do you know if you own it as joint tenants or as tenants in common?” I asked.

Unsurprisingly, I was met with a blank stare. “What does that mean?” the client asked, as many do. Unfortunately, many people who might benefit from knowing the difference when they are purchasing a property don’t seem to be informed by real estate agents or conveyancers when making such an important transaction.

Here are the key points about each type of ownership:

Joint tenancy:

Each joint tenant owns the whole of the property jointly with the other owner or owners. None has a specific share in the property while the joint tenancy continues. Everything is shared equally, including rental income and profit.

Upon the death of one joint tenant, the principle of survivorship applies. That means that the surviving joint tenant(s) acquire the deceased’s share of the property automatically by law. A joint tenant cannot include that property in their will as it will pass directly to other surviving joint tenants.

Tenants in common:

 Each tenant in common does own a specific share of the property, which can be at any proportion. In real estate, one tenant in common can own 99% and another only 1%.

A tenant in common can Will their share as they see fit, with the surviving tenant having no say in it.

Joint tenancy is most suitable for spouses who want the principle of survivorship to apply, but often the property is purchased as joint tenants as a default. homesTenancy in common may be more suitable in the situation of a marriage of two people with children from previous relationships who would like ownership to pass to those children in their Will. It is very likely to be more suitable for siblings, other family members and relationships.

Fortunately for my client, they were able to speak to the conveyancer who handled the settlement of their property (during our appointment) and they confirmed that the siblings owned the property as joint tenants.  This gave them the best possible result for their tax return.

A joint tenancy can be changed into a tenancy in common if the parties wish.

If you need advice tailored to your requirements please contact us at Optima Partners on 62672200.

Daniel Causerano




Daniel Causerano – Senior Accountant


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