A Deed of Trust, also known as a Declaration of Trust, is a document used to specify how a property is held between joint owners; it confirms the actual proportions in which owners own their homes.
A Deed of Trust is commonly used to hold property in joint names but in different proportions especially where there have been differing contributions towards the purchase price, as it helps determine the division of any proceeds of sale when the property is sold.
Co-owned properties can be held as Joint Tenancy (beneficial Joint Tenants) or Tenancy in Common (as beneficial Tenants in Common).
Where joint owners of a property hold the beneficial interest as Joint Tenants, the owners together own the entire property in equal shares, and if one owner dies their share passes to the other(s) automatically, irrespective of the provisions in the deceased’s Will. In other words, neither of the owners have a separate share which they can sell or leave in a will, and if one owner dies than the survivor becomes the owner of the whole property. This happens automatically without any further formality.
Where joint owners of property hold the beneficial interest as Tenants in Common, each owner holds a separable right or interest in the property. Please note - Where joint owners of property hold the beneficial interest as Tenants in Common, in the absence of a specific Deed of Trust to apportion the income according to the Deed, they will be deemed to hold the property in equal shares (i.e. on a 50/50 basis).
This Declaration of Trust – Tenants in Common (Fixed Shares) shall be used where joint owners wish to declare fixed beneficial interests in the property. In other words, this Deed of Trust contains an express declaration that the co-owners hold the property on trust for themselves as Tenants in Common, and sets out the extent of their respective beneficial interests, which is based on fixed shares agreed between the co-owners.
With this Declaration of Trust - Tenants in Common (Fixed Shares) the co-owners want their respective beneficial interests to be fixed, as it sets out each owner’s percentage share in the property, irrespective of the financial contributions which each of them makes. This means that the proportions in which the co-owners are beneficially entitled to the property is fixed.
This Declaration of Trust – Tenants in Common (Fixed Shares) assumes that there are two or more individuals who jointly own the property, that the property is situated in England and Wales and each of the co-owners is resident and domiciled in England and Wales.
Please note - This Document Template can be amended to provide for more co-owners, however, you should note that a legal estate may be held by a maximum of four people. Also, this Document Template shall not be used where the owners are changing the proportions in which they hold the property as Tenants in Common.
This Declaration of Trust – Tenants in Common (Fixed Shares) template is fully comprehensive and flexible; it can be adapted to fit most situations. It can be used where:
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The title to the property is registered or unregistered and whether the property is freehold or leasehold
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The Declaration of Trust is being entered into contemporaneously with the transfer, conveyance or lease of the property to the owners or where the owners have held the property as Tenants in Common since the transfer, conveyance or lease of the property to them but have not yet declared the extent of their beneficial interests
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The owners originally owned the property as Joint Tenants but the Joint Tenancy has been severed, or is being severed by this Deed, and they now wish to declare their beneficial interests following the severance
This Declaration of Trust – Tenants in Common (Fixed Shares) is in Microsoft Word format, written in plain English, easy to use and edit.
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