Slide 1
Practical Solutions and
value-for-money
service

Practical Solutions and value-for-money service

Slide 1
Practical Solutions and
value-for-money
service

Practical Solutions and value-for-money service

Own a Property Jointly? Here’s Why You Need a Declaration of Trust

Do you own a property or land with someone else? A declaration of trust can help you avoid arguments and expensive dispute resolution costs in future.

If you own or are about to own a property with someone else, have you considered what happens if you go your separate ways or if one of you dies? Our private client department talks about the importance of a declaration of trust and why you should always have one.

Who needs a declaration of trust?

Regardless of whose names are on the title deeds or recorded at the Land Registry, there may be times where a third party owns a share in the equity of a property. Also, it is very common for unmarried couples to fail to consider how they will divide the equity if they go their separate ways in the future.

Everyone who is entitled to a share of the value of a property is known as a beneficial owner and beneficial ownership is not always as simple as looking at the names on the deeds.

We always recommend you speak to us about obtaining a declaration of trust in any of the following situations:-

  • If you are buying a property with someone else
  • If you already own a property with someone else
  • If someone else is financially contributing to your purchase or has contributed when you bought it
  • If you have made significant contributions towards the mortgage or renovations/improvements, and you wish this to be accounted for when the house is sold

What if I don’t have a declaration of trust?Man and woman carrying boxes downstairs - Own a Property Jointly? Here’s Why You Need a Declaration of Trust

If one party contributes more to the purchase price than the other owner(s), you need to record the shares you each own, in case the property is sold in future.

If you are an unmarried couple and separate in the future, how will you agree on the shares that each of you owns? One of you might disagree and claim you own a larger share but without a declaration in place, it is difficult to prove.

Perhaps you have renovated your property and contributed significantly to the costs of renovation. Would you not want to make sure your contributions are recorded? Maybe one of you has paid large chunks off your mortgage and you want this to be reflected in future when the property is sold, so that you receive a larger share of the equity.

What if a joint property owner dies?

Good question.

It is highly possible that the share belonging to the owner who dies will pass under the Intestacy Rules to his or her closest surviving blood relatives. The surviving joint owner(s) might end up owning the property with strangers!

Joint owners who do not hold their shares as ‘beneficial joint tenants’ should also make sure they have a professionally drafted will in place, to leave their share to whoever they choose.

My parents have given me some money towards the property I’m purchasing with my partner

There are a few questions raised here. Was the money a gift? Or are your parents to be paid back on a sale? Do they intend to acquire an interest in the equity?

If the various shares in the property are not recorded in a declaration, your parents could stand to lose thousands on a future sale without the evidence to prove they own a share. Equally, without the evidence that they are to be repaid, they will struggle to prove the money was a loan.

Additional features of a declaration

Declarations of trust can record various arrangements and include features such as:-

  • Agreeing who will pay bills and/or mortgage payments and in what frequencies
  • Providing indemnities in the event that one person stops paying the mortgage
  • Clearly set out the proportions to be paid to each party

If you are buying a property through us, our conveyancing team will encourage you to speak to our private client specialists for advice on a declaration of trust.

You can however draw up a declaration of trust at any time and you don’t have to be purchasing right now to have one. If you don’t have one in place, contact us today.


The content of this post does not constitute legal advice and should not be relied upon. The content is subject to change and we accept no liability for individuals relying on the information within this article.

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