When taking instructions for preparation of Wills, I often find that clients want to give their house/property as a gift to a certain beneficiary. While this can be a noble gesture, the ownership structure of the property can be crucial as to whether or not, or how, the gift will take effect.
A property which is owned with someone else (or a number of other people) may be owned as joint tenants or tenants in common, and the difference between the two is crucial in estate planning.
If a Willmaker owns a property as a joint tenant, then:
Owning a property as joint tenants can be useful if the Willmaker feels that there is a risk that someone may apply to the Court for further provision from their estate. If the Willmaker passes away before the other owner, the property will not form part of their estate which will be the subject of a claim for further provision.
If a Willmaker owns a property as tenants in common, then:
If a Willmaker wishes to distribute their share of a property which is owned as tenants in common, I always recommend they give serious thought to the consequences of the gift. For example, while it may seem fair to distribute their half share of the home they live in with their current partner to their children from a previous relationship, if they pass away, it may not be very practical for their children to own the property with the current partner.
If you are considering gifting a property to a beneficiary under your Will, or if you have been gifted a property under a Will and are concerned about the implications of receiving that gift, you should contact an experienced estate lawyer. Please contact me should you require assistance or advice.