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Severance of Tenancy

Although nobody likes to think about their spouse re-marrying after they have died, it can often happen. Severance of Tenancy to Tenants in Common can ensure your share of any property passes to your beneficiaries and not your spouse's new partner as well as providing other substantial financial benefits.

What is a Severance of Tenancy?

Severance of Tenancy to Tenants in Common is recommended for couples who own their own home. A majority of couples who used a Mortgage to buy their home or who have not received professional Estate Planning advice own their home and any investment properties as Joint Tenants. This is because Mortgage lenders have always preferred to lend to couples who buy properties on a Joint Tenant basis. Changing from Joint Tenants to Tenants in Common is a completely legal and painless process allowed by the Government. In legal terms it is referred to as a Severance of Tenancy, but in practical terms it does not involve a change in the ownership in the property or the percentage of the property each partner owns. The change to own the property as Tenants in Common is registered with the Government Land Registry department who charge a small fee for registration.

Benefits of becoming Tenants in Common

Owning a property as Joint Tenants is useful in that if one partner dies the other partner inherits their share of the property. However, there are various reasons why this may not be the best option for you and owning a property as Joint Tenants can have several very negative financial implications. Owning a property as Tenants in Common can have several substantial financial benefits. Although nobody likes to think about their spouse re-marrying after they have died it can often happen and result in your estate passing to your spouse’s new partner and not your beneficiaries. Whether the aim is to protect your share for someone other than your partner or to define the portions in anything other than an equal share, it is important that you sever the tenancy on the property to avoid the automatic transfer to the joint owner.

Owning a property as Tenants in Common is also extremely important for couples who wish to make use of a Will Trust or a Wealth Preservation Family Trust to reduce their beneficiaries payment of Inheritance Tax to the Government. If the value of your and your partners Estate is sufficient, the Government can charge your children Inheritance Tax when they inherit your Estate. Inheritance Tax can reduce the amount of money your children inherit dramatically. Severance of Tenancy can in a completely legal way, reduce your loved ones' Inheritance Tax bill by up to 100%.

If you or your partner is forced to go into a care home your Local Authority can charge the cost of your care to your assets, savings or even your home. Therefore, the amount of money your children inherit can be reduced dramatically. A Severance of Tenancy is a completely legal way to reduce your liability to pay care fees by up to 50%.

Owning a property as Tenants in Common also offers a significant degree of financial protection from being repossessed if you or your partner get into financial difficulty with creditors in the future. We provide professionally drafted and fully insured Severance of Tenancy at very reasonable prices.

Arrange a Quotation

Our clients have the flexibility of dealing with our Company by talking to us at our offices,
by telephone, post or in your home. Our contact details can be found below.
Westminster Trust
34 Clarence Street
Southend on Sea
Essex
SS1 1BD

Email:
Telephone: 01702 414 100
Facsimile: 01702 667 771
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