No grant needed: Transferring jointly owned property after death

We’ve seen differing advice and vague suggestions that there are times when an estate containing a jointly owned property will require a grant of representation to transfer that property. This is an umbrella term for grants of probate, and grants of letters of administration and will be referred to throughout this blog as a “grant” for ease.

In this blog, we intend to clarify that you don’t need a grant to transfer a jointly owned property on death, regardless of whether it’s held beneficially as joint tenants or tenants in common.

Do you need a grant to transfer jointly owned property after death?

No. If a deceased person’s estate includes a share of jointly owned property, a grant isn’t required to transfer the legal title following their death.

Do owners who held as tenants in common need a grant to transfer property after death?

You still don’t need a grant, as the legal ownership passes automatically to the surviving owner in the same way as when a property is held as joint tenants. When a property is held as “tenants in common”, this refers to the beneficial ownership.

The Land Registry reflects legal ownership, and legal ownership is only ever owned as joint tenants, automatically vesting in the surviving owner.

Legal ownership, beneficial ownership, joint tenants and tenants in common explained

All of the relevant terms in one place:

• Legal ownership – The ownership as legally recorded (in this case, on the Land Registry).

• Beneficial ownership – The person who actually benefits from the item (in this case, who would receive the proceeds of sale).

• Joint tenants – Each owner shares 100% ownership, so on the death of one holder, the property interest automatically vests wholly in the survivor(s).

• Tenants in common – Each owner owns a distinct share, usually laid out separately, otherwise you assume equal shares. You can transfer your share of the property under a will.

For a helpful explanation of the difference between legal estates and beneficial interests, see this blog from the Land Registry.

Can legal ownership be held as tenants in common?

No. You can only ever hold legal ownership as joint tenants. So, on the death of one legal owner, the ownership automatically vests in the survivors.

What happens when a tenant in common dies?

The legal ownership vests in the surviving owner. The surviving legal owner holds the deceased’s beneficial share on trust for the beneficiaries of the estate.

Does a trust arise when property is held as tenants in common after death?

Yes, and you’d need to register it on HMRC’s Trust Registration Service (“TRS”).

There are various requirements for registering trusts on TRS, but here as there’s a mismatch between the legal and beneficial ownership, you’re required to register the trust.

Our trust team are experienced in dealing with this, so please do reach out if you have any questions about TRS.

When is a grant of representation needed to transfer property?

If the sole owner of the property dies. There are no other circumstances – if the last surviving owner dies, it’s the same situation, as the legal ownership will have vested in them.

What happens to the beneficial interest after death?

The beneficial interest would vest in the personal representatives, and they can deal with that interest and may transfer, or “assent”, it to the beneficiaries entitled to it.

There’s a risk management point here, as the personal representatives may want to get a grant to confirm who the beneficiaries of that share are. However, it’s not a legal requirement to get a grant.

What’s the risk of proceeding without a grant?

As we’re dealing with estates, the responsibility of the personal representatives (the collective term for executors and administrators appointed under a grant of representation) is to collect in the deceased’s assets and distribute them to the correct beneficiaries. For more information about the process and responsibilities involved, see our guide on administering an estate.

Because personal representatives can be held personally liable for mistakes, they need to manage their risk carefully. In straightforward family situations, they may feel comfortable proceeding without a grant.

However, professional executors or those administering an estate that is likely to be disputed, may prefer to take a more cautious approach and require a grant before proceeding.

Why might someone ask for a grant for jointly owned property?

Two reasons come to mind.

To identify the personal representatives

The first requires a bit of understanding of what exactly a grant is. At its core, it’s an exercise in risk management. The grant is a court-sealed document that confirms who has the legal authority to receive and administer the assets of a deceased person.

So, if you were the second legal owner of a property, and you wanted to know who to pay the sale proceeds to, you may already be comfortable that you know who the right person is. If you’re not comfortable that you can be sure who the right person is, the best thing to do is to ask for a grant so you can see who the court has appointed to receive those funds.

Common misconception

The second is a common misconception. Many people don’t realise that a grant isn’t required to transfer jointly owned property and may incorrectly request a grant before processing the transfer.

If this happens, please get in touch – we can often help complete the transfer without the time and expense of obtaining a grant.

How do you update the Land Registry after a joint owner’s death?

The surviving legal owner would apply to transfer the legal ownership to the new beneficial owner. This may be appropriate where the intention is for the legal ownership to reflect the beneficial ownership following the death.

As the legal and beneficial ownership would then align, the TRS registration would no longer be required. It may also make matters slightly easier when the surviving joint owner dies, as the legal interest will again pass automatically to the surviving legal owner.

What’s a Form A Restriction?

A Form A Restriction is a restriction on the title that prevents one person from selling the property on their own.

You can apply to have it removed, or if you’re selling the property, you can simply “overreach” it, by appointing a second person to act alongside you in the sale.

What happens if there’s no will and the estate is intestate?

This seems like a situation where from a risk management point of view, you’d want to insist on seeing a grant when releasing the sale proceeds to make sure the right people benefit.

You wouldn’t need to get the grant on first death, but in some circumstances, it may make practical sense to do so. Otherwise, you’ll be trying to find more details on second death, and the surviving owner might have some helpful information.

So, is a grant necessary?

There are many other triggers for a grant, and it’s often the case that whilst you don’t specifically need the grant to transfer the joint property, other assets do require a grant, so you’ll be getting one anyway.

The positive news from this blog is that if you’re getting a grant anyway, you don’t need to wait until the grant issues to submit a Deceased Joint Proprietor (DJP) application to HM Land Registry and transfer the property ownership.

To summarise, as the legal ownership will always be held as joint tenants, the ownership will always automatically vest in the surviving owner, and you don’t need a grant to transfer ownership on the Land Registry.

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