25th March 2021

Joint title to heritable property – implications for estate administration

Heritable property is, more often than not, the biggest asset in an estate. When dealing with the administration of an estate, we are required to check the deceased’s title deeds to determine how title to their property is held.  If someone owns heritable property on their own, the matter is straightforward and the property falls to be dealt with either by their Will (if they have one), or by the laws of intestate succession (the “intestacy rules”) in Scotland.  If the deceased owned heritable property jointly with someone else, title to the property will either be held:

  1. In joint names ‘and to the survivor’ of the joint owners, or
  2. In joint names but in separate ‘pro indiviso’ shares with the joint owner.

If the deceased held title to the property in joint names ‘and to the survivor’ then, on the first death, the property passes automatically to the survivor named on the title deeds.  No matter what the Will says, the survivor detailed on the title deeds will become the owner of the deceased’s interest in the property.  Confirmation (Scottish Probate) will not be required in order to complete the transfer of the deceased’s interest into the survivor’s name; a copy of the death certificate will simply be placed with the title deeds.  Although sometimes this could be considered a benefit, it is also a much less flexible way of holding title to a property given that Confirmation may often be required for other assets in the estate anyway.  The value of the share of the house passing by survivorship is still included in the estate for inheritance tax purposes.

If the deceased held title in separate ‘pro indiviso’ shares, the deceased’s interest is dealt with in terms of their Will or, in the event of the deceased not having a Will, the intestacy rules.  Joint title to property is increasingly being taken in separate ‘pro indiviso’ shares. In general, property held on this basis is considered a more flexible approach to joint property ownership. It can be beneficial for those interested in, for example, care cost planning. In the context of estate administration, Confirmation will be required to transfer the deceased’s interest in the property to whoever is due to inherit it in terms of the Will or, if there is no Will, the intestacy rules. In the same way as property passing by survivorship, the value of the deceased’s interest in the property is taken into consideration for inheritance tax purposes.

Careful examination of the title deeds is always required in both lifetime planning for clients, as well as during the administration of an estate.

If you need any advice about your title deeds, dealing with the preparation of a Will or the administration of an estate, get in touch with Blackadders’ Private Client Teams working in Aberdeen, Dundee, Edinburgh, Glasgow, Perth and across Scotland.

Sienna Sproson, Associate Solicitor
Private Client
Blackadders LLP

www.blackadders.co.uk 

 

 

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