On three separate occasions last week, the issue of 'jointly' owned assets arose.
A concise summary of the difference between owning something as joint tenants and tenants in common can be found via the 'core services' section of the View Legal website (viewlegal.com.au).
Practically, the distinction normally becomes most relevant at times when it is too late to implement a change – for example on death, litigation or relationship breakdowns.
As a general rule (although there are always exceptions), for most business owners, professionals or people in long term relationships, jointly owned assets should be owned as ‘tenants in common’ to provide the greatest amount of flexibility. This conclusion is not always the case and in fact often the preferred position is that one party has no ownership of the relevant asset – in other words, as part of the review process, it is transferred to another person or structure.
Ultimately, as I was reminded last week, there are two things you should keep in mind, namely:
1. Remember the distinction between the two joint ownership structures.
2. Make sure that in relation to each asset for any particular client, you know which ownership structure applies.
Until next week.
Matthew Burgess
