9:59 AM, 18th August 2020, About A year ago 1
When buying a property as tenants in common and splitting the ownership into unequal shares between married and non-married partners (property being bought in four names) is there a difference between just completing a TR1 form as opposed to a full DOT for CGT purposes only upon sale of the property?
The property is being bought to renovate and then to sell on.
HM Land Registry Guidance: how to complete form TR1 >> click here
This panel should be completed if there is more than one transferee.
Joint ownership is a difficult area of the law. It can lead to disputes when a joint owner dies or the relationship between joint owners breaks down. Recording the joint owners’ intentions in panel 10 of the transfer or in a separate form JO (discussed below) may help to avoid such disputes later on. However, this is only a starting point, as the joint owners’ intentions may change over time.
If there is more than one transferee, as joint owners they will automatically hold the property on trust for themselves and/or anybody else who has a beneficial interest in the property.
Joint owners can hold their beneficial interest in the property as joint tenants or as tenants in common.
Beneficial joint tenants do not own specific shares in the property. If one of them dies, their interest passes automatically to the surviving beneficial joint tenant(s) even if they have made a will leaving it to someone else.
Beneficial tenants in common own specific shares in the property, which may be equal or unequal and they can leave their share to someone else in their will.
Unless it is clear, at the time of acquisition, that the joint transferees intend to hold the beneficial interest on trust for themselves alone as joint tenants, we have a duty to enter a restriction in Form A in the register. The effect of this restriction is that we will not register a sale or mortgage of the property unless there are at least two registered proprietors, as trustees, to jointly receive the sale or mortgage monies. This means the last survivor of tenants in common is not permitted to sell the property without proving that the trust has come to an end or appointing a new co-trustee.
If the joint transferees intend to hold the property on trust for themselves alone as joint tenants, they should place an ‘X’ in the first box. Alternatively, if they intend to hold the beneficial interest as tenants in common in equal shares, they should place an ‘X’ in the second box. They should place an ‘X’ in the third box if they intend to hold it in unequal shares, or for themselves and others (whether in equal or unequal shares), or under the terms of a separate existing trust deed or will, and in each case they should also add the relevant details.
As an alternative to completing this panel, you may use the trust information form JO. Form JO contains the same options as panel 10 but is designed as a separate form to assist in providing the relevant information and ensuring that each joint transferee signs a declaration of trust (see panel 12 below.) If the declaration of the trust on which the transferees will be holding the property is already contained in a separate deed or will, a conveyancer may include details of it in, and sign, the form JO instead of the transferees.
If neither panel 10 of the transfer nor a form JO are completed and lodged with the application to register a transfer to joint transferees, we will enter a Form A restriction by default.
If you have any doubts about what is required, you should seek professional advice before you proceed.
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