What is Severance of Tenancy?

Full Definition

Severance of tenancy is the act of changing how co-owners hold a property, switching from a joint tenancy to a tenancy in common. Under a joint tenancy the survivor automatically inherits the whole property on death (the right of survivorship), and the share cannot be left by will. Once the tenancy is severed, each owner holds a defined share -- often but not necessarily equal -- which they can leave to whomever they choose in their will. In England and Wales severance is usually achieved by serving a written notice of severance on the other owner(s) and registering a Form A restriction at HM Land Registry. It is commonly used in estate planning, for example to leave a share to children rather than the surviving co-owner, or as part of arrangements involving care-fee planning. Severance affects how the property is dealt with for Inheritance Tax and on later sale, so legal advice is normally recommended before acting.

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