As Tenants in Common, each party has a distinct and severed share in the property. If one owner dies, his or her share does not pass straight to the surviving co-owner/s, but passes according to the deceased’s Will (or under the Intestacy Rules if there is no valid Will).
There may be several reasons why you should consider holding property on a tenancy in common:
ο where unmarried couples, friends, or relatives decide to buy property together – each may wish to pass their share to their own family member.
ο if a married couple may not want their individual share of the property to pass to the surviving spouse outright on death. For example, on a second marriage where both spouses have children from their respective first marriages, they may want their distinct shares to end up with their respective children, to ensure that all children are treated equally. The alternative would be to leave the Will of the survivor to regulate who gets what – and unfortunately the concept of the “wicked stepmother” (or stepfather) is far from a fairytale fiction.
ο where owners may have made unequal contributions to a property purchase. This should be recorded in the event of a future sale of the property, or if the relationship breaks down. For a tenancy in common, property is assumed to be owned in equal shares unless otherwise evidenced.
ο for asset protection reasons, such as ensuring that the property of the first spouse to die is not vulnerable to being used in funding the survivor’s future care fees, or is left to a second spouse.