When you`re purchasing property with another individual or individuals, you may decide to take out a joint tenancy agreement. This kind of agreement means that you all own equal shares of the property, and if one of you were to pass away, their share would automatically pass to the other owners. However, there may come a time when you want to sever the joint tenancy agreement. Here`s what you need to know about the process.
Why Sever a Joint Tenancy Agreement?
There are a few reasons why you might want to sever a joint tenancy agreement. One common reason is if you and your co-owners are no longer getting along, or if one of you wants to sell their share of the property. Additionally, severing the agreement can help you avoid inheritance tax, as it means that each owner`s share of the property will be treated as a separate asset.
How to Sever a Joint Tenancy Agreement
Severing a joint tenancy agreement is a relatively straightforward process, but it does require some paperwork. The first step is to complete a notice of severance form, which you can usually obtain from your solicitor. This form will need to be signed by all the co-owners of the property.
Once you`ve completed the notice of severance form, you`ll need to send it to the Land Registry, along with the appropriate fee. The Land Registry will then update the property`s title deeds to reflect the fact that it is no longer owned as a joint tenancy.
It`s worth noting that severing a joint tenancy agreement can have significant legal and financial implications, so it`s always a good idea to seek professional advice before going ahead with the process. For example, if you sever the agreement without proper planning, it could result in a significant tax bill down the line.
In conclusion, severing a joint tenancy agreement can be a useful way to take control of your property ownership and avoid unnecessary inheritance tax. However, it`s important to understand the process and seek professional advice before proceeding. With careful planning and attention to detail, you can successfully sever your joint tenancy agreement and move forward with your property ownership goals.