Joint Tenants vs Tenants in Common for Inheritance Tax UK: What's the Difference and Which Is Better? (2026)
Joint tenancy: property passes automatically to the survivor on death — no probate, nothing in the estate on the first death. Tenants in common: the deceased's share passes under the will — it is in the estate and can be directed to children (claiming the RNRB) or into an NRB trust. Severing a joint tenancy is a powerful IHT planning tool — and can be done unilaterally in writing, without the co-owner's agreement.
| Feature | Joint Tenancy | Tenants in Common |
|---|---|---|
| On first death | Passes automatically to survivor (right of survivorship) | Deceased's share passes under will/intestacy |
| In deceased's IHT estate? | No — passes outside estate | Yes — share is in estate |
| Probate required? | No (for this asset) | Yes (for the share) |
| RNRB on first death? | No — property not in estate | Yes — if share passes to direct descendants |
| NRB trust planning on first death? | No — property bypasses estate | Yes — share can go into NRB trust in will |
| Protection for first marriage children? | No — all passes to survivor | Yes — share directed in will to own children |
| Can be changed unilaterally? | Yes — serve notice to sever | Shares cannot be changed unilaterally |
| Best for | Simple estates, smaller values, simplicity | Complex estates, blended families, RNRB optimisation |
Joint Tenants vs Tenants in Common: Complete IHT Guide
What is joint tenancy and how does it work for IHT?
A joint tenancy is a form of co-ownership where each owner holds the whole property together with the other owners — not a distinct share. The fundamental feature is the right of survivorship: when one joint tenant dies, their interest automatically passes to the surviving joint tenants, regardless of what the will says. The deceased joint tenant's interest does NOT pass under the will (or intestacy) — it simply vests in the survivors by operation of law. For IHT purposes on the first death: the deceased's half (or other proportion) does NOT form part of the estate for IHT — there is no 'share' to include. The property is simply 100% owned by the surviving joint tenant(s) after the death. The property IS fully in the surviving joint tenant's estate — on the survivor's death, the full property value is in the estate and subject to IHT. In practice, for a married couple who own jointly as joint tenants: (1) First death: the property passes automatically to the surviving spouse — IHT-free under the spousal exemption (s18 IHTA 1984), and the right of survivorship also means it does not need to go through probate; (2) Second death: the full property is in the survivor's estate. The RNRB (if the will directs the property to children) may apply on the second death.
What is tenancy in common and how does it work for IHT?
A tenancy in common is a form of co-ownership where each owner holds a specified share of the property — typically 50/50, but can be any proportion (60/40, 70/30, etc.). Each owner's share is separate: (1) Each co-owner can deal with their share independently — sell it, give it away, or leave it in their will; (2) There is no right of survivorship — when a tenant in common dies, their share passes under their will or intestacy, not automatically to the co-owner; (3) The deceased's share IS in their estate for IHT — the value of the share (typically 50% of the market value of the whole property) is included in the IHT estate; (4) Valuation discount: a minority share of a property may attract a valuation discount (typically 10–15%) because a fractional interest in a jointly owned property is less attractive to buyers than the whole property. For IHT purposes, the value of a tenants in common share is usually discounted from the pro-rata share of the open market value. The key IHT advantage of tenancy in common: the deceased's share passes under the will — which means it can be left to children (claiming the RNRB) or to an NRB trust (using the NRB on the first death), rather than automatically passing to the surviving spouse.
Severing a joint tenancy: converting to tenants in common
A joint tenancy can be severed (converted to tenancy in common) at any time during life: (1) One co-owner can sever unilaterally by serving a written notice on the other co-owner(s) under s196 Law of Property Act 1925; (2) A bilateral agreement between all co-owners is also effective; (3) A deed of severance or simply a written notice stating the intention to sever is sufficient — no court involvement is required; (4) After severing, each co-owner holds an equal share as tenants in common (50/50 for a two-owner property — the shares become equal unless separately agreed). Effect of severance for IHT: before severance (joint tenancy): deceased's interest passes by survivorship, no estate share; after severance (tenancy in common): deceased's 50% share is in their estate. This appears to make the IHT position worse — but in most cases it is beneficial, because: (a) The will can now direct the deceased's share to children (claiming the RNRB, or using the NRB on the first death in a trust); (b) The deceased's NRB can be used on the first death against the share value, rather than being wasted if everything passes to the spouse by survivorship; (c) Where the surviving spouse's estate would otherwise exceed the RNRB taper threshold (£2m), the tenancy in common structure allows part of the estate to be removed from the survivor's estate on the first death.
When joint tenancy is better for IHT
Joint tenancy can be the better structure for IHT in several circumstances: (1) Couples with straightforward estates below the combined threshold: for a couple with a combined estate below £1,000,000 (the combined NRB + RNRB threshold), joint tenancy simplifies estate administration — the property passes automatically to the survivor and is ultimately left to children under the survivor's will. No IHT planning benefit from severing; (2) Couples where the survivor may need to sell: joint tenancy avoids the need for probate before the property can be sold by the survivor — the survivor has full ownership immediately on death. If probate is needed before the property can be dealt with, a tenancy in common share passes through the estate and probate takes time; (3) Protection from the deceased's creditors: jointly tenanted property passes outside the estate — creditors of the deceased cannot claim against the jointly tenanted property on the first death (they can only claim against estate assets). Jointly tenanted property is NOT accessible to the deceased's creditors after death.
When tenants in common is better for IHT
Tenancy in common is preferable in these IHT scenarios: (1) Blended families / second marriages: if either partner has children from a previous relationship, tenancy in common allows the deceased's share to be left in the will to those specific children — rather than passing automatically to the surviving spouse (who might later change their will and cut out the children from the first marriage); (2) NRB discretionary trust planning: where the estate is large enough to benefit from using the NRB on the first death, the deceased's 50% share can be directed into an NRB discretionary trust — using the NRB efficiently, reducing the survivor's taxable estate, and potentially providing care home fee protection; (3) RNRB optimisation: in some structures, directing the deceased's share of the home to children (via the will as tenants in common) claims the RNRB on the first death; (4) Large estates above the RNRB taper: severing and directing the first share to children can reduce the survivor's estate below the £2m RNRB taper threshold, preserving the full RNRB on the second death; (5) Protecting against the survivor remarrying: the deceased's share is fixed under the will — a surviving spouse who remarries cannot give away the deceased's share.
The RNRB, joint tenancy, and tenants in common: key interactions
The RNRB (s8D IHTA 1984) requires the qualifying residential interest to pass to direct descendants. For joint tenants: on the first death, nothing passes to descendants from the first death — the property passes to the surviving co-owner by survivorship. The RNRB can only be claimed on the second death (when the survivor's will leaves the property to children). If both NRB and RNRB are to be claimed on the second death, the survivor's will must direct the property (or sufficient other assets — downsizing addition) to direct descendants. For tenants in common: the deceased's share passes under the will on the first death. If the will directs the share to children, the RNRB can be claimed on the first death (as well as the survivor's RNRB on the second death). This means: tenancy in common potentially allows the RNRB to be claimed on BOTH deaths — double RNRB benefit. However, the RNRB on the first death is only beneficial if the estate on the first death is above the NRB (so there is IHT to mitigate). For smaller estates where there is no IHT on the first death, the RNRB on the first death is irrelevant — and the joint tenancy/survivorship is simpler.
Frequently Asked Questions
What is the difference between joint tenants and tenants in common for inheritance tax?
Joint tenancy: on death, the property passes automatically to the surviving co-owner(s) by right of survivorship — outside the will and outside the IHT estate on the first death. The full property is only in the estate on the last surviving owner's death. Tenancy in common: each owner holds a specific share that passes under their will or intestacy on death — the deceased's share IS in their IHT estate. Tenancy in common allows the deceased's share to be left to children (claiming the RNRB) or into an NRB trust on the first death.
Should I own property as joint tenants or tenants in common for IHT?
It depends on your estate and family circumstances. Joint tenancy is simpler and avoids probate on the first death — suitable for couples with small estates below £1m combined or where simplicity is the priority. Tenants in common is better where: you have children from a previous relationship; your estate is large enough to benefit from using the NRB on the first death; you want to claim the RNRB on the first death; or you want to direct the first share into an NRB trust for asset protection/care home planning. Take professional advice for large estates.
How do I change from joint tenants to tenants in common?
Sever the joint tenancy under s196 Law of Property Act 1925. This requires: (1) Written notice of severance served on the other co-owner(s); (2) No court involvement — just a written notice or deed of severance; (3) Registration at Land Registry (form SEV to remove 'beneficial joint tenancy' restriction if one is registered, or to add a 'Form A restriction' for tenancy in common). After severance, each co-owner holds a 50% share as tenants in common. Update the will immediately after severing — the share now passes under the will, so the will must direct where it goes.
Can a joint tenancy be changed without the other owner's agreement?
Yes — severance of a joint tenancy is unilateral under s196 LPA 1925. One co-owner can serve a written notice on the other(s) without requiring their agreement. The notice must be served (delivered) to the other co-owner — posting it to the property address is generally sufficient. The Land Registry should be notified. Note: you cannot change the shares (e.g. from 50/50 to 60/40) unilaterally — only severance from joint to tenants in common (at equal shares) can be done unilaterally. Changing shares requires the other owner's agreement.
Does joint tenancy property go through probate on the first death?
No — jointly tenanted property passes automatically to the surviving co-owner by right of survivorship, without needing to go through probate. This is one of the practical advantages of joint tenancy. The property is simply re-registered in the sole name of the surviving owner at the Land Registry, with a death certificate as evidence. Tenants in common property requires the deceased's share to go through the estate (and probate if the estate meets the probate threshold), before it can be transferred to the beneficiary.
Update Your Will After Severing a Joint Tenancy
Severing a joint tenancy changes how your property share passes on death — it now passes under your will. Update the will immediately to direct the share correctly: to children for RNRB, or into an NRB trust for asset protection. WillSafe will kits for England and Wales make this easy.
View Will Kits from £39.99