CALL US NOW 604-283-8622

Joint Tenancy : 5 Common Issues

Joint Tenancy : 5 Common Issues

Joint Tenancy

It has become very popular in British Columbia to transfer property (assets) into joint tenancy.

Usually, it is done as a vehicle to reduce probate fees and legal fees upon the death of the owner of the property. Generally speaking, it is good to have joint tenancy between a husband and wife, because it simplifies matters and saves money. Furthermore, when couples have joint tenancy, it becomes a fairly simple procedure to transfer property from a deceased joint tenant into the name of the surviving joint tenant(s). What complicates joint tenancy is when other parties are added to the title, such as children.

Below outlines 5 common problems:

1.Gift or Trust?

If the property is transferred from one parent into the names of the parent and one of the parent’s children, it can become an issue as to exactly what interest the child holds in the parent’s property. For instance, if the interest is solely held for estate planning purposes and there was no real intention to gift the property to the child, then the child would not hold the property in trust for the parent and parent’s estate.

A common situation when this becomes a problem is when the most substantial asset of the parent is put into the name of one child, but there are a number of other children. For instance, it might have been the intention of the parent that the one-child holding joint tenancy would then transfer the property to the other children upon the parent’s death. If the transfer is not made to the other children, a court will have to decide what the parent’s intentions were. This is not an easy task for a judge, and this scenario creates many problems. Therefore, it is not recommended as an estate-planning vehicle. Instead, if you specifically wish to exclude a child from your estate by a transfer to joint tenancy to another child, one must include a written declaration of your intention to make a gift.

Another common difficulty occurs when the parent wishes to get the property back or mortgage the property, and the child or children refuse to make the transfer. If there has been an out-and-out gift, the children do not have to transfer the property back to the parent. It is common that children will object to mortgages being placed on the property because it could affect their inheritance.


Be aware that if the property is transferred into joint tenancy with a child, to outside observers searching government registries, the property would appear to be owned by the child. For instance, if the child becomes bankrupt or has an impaired judgment from an accident, then the child’s portion of the joint asset can be attacked by creditors.

Spousal claims are another common problem. The issue would then be in regards to whether the child, in fact, owned the property, or was simply a trustee (see above)

3.Taxation Problems

If there has been a true gift of property to the joint tenant adult child, the income tax authorities will consider the property disposed of for fair market value. A personal residence could lose part of its tax-exempt status. For instance, if one-half a personal residence was gifted to one child and the property then appreciated, one-half the appreciation of the child’s share would be a capital gain to the child on the sale of the property. Furthermore, the disposition of other capital items such as shares or recreational property could trigger capital gains even if the transfer is a gift to an adult child. The parent would have to pay the tax, which will be far more than any probate fee.

4. Loss of Control

Any joint tenant owner has an equal right to use the property. At any time before or after your death, the surviving joint tenant adult child (or potentially grandchild with the child’s consent) can move into the property. The property cannot be sold without the agreement of all owners unless a court order is obtained. Ultimately, this means your executor loses control over who lives in your property and when it is sold.

5. Unexpected Survivorship Consequences

If one of the joint tenants dies before you do, the deceased joint tenant ceases to own an interest in the property. This is because their interest in the property transfers to the surviving joint tenants. If a joint tenant adult child with children dies, the property will not transfer to their children. Instead, it will transfer to the surviving joint tenant(s). Lastly, a joint tenant can change the title to tenants-in-common (no survivorship) or sell their share at any time.

Ultimately, I do not recommend that property be transferred into the names of children as joint tenants with their parents. It is important that seniors maintain their independence by checking their own assets. Probate fees become lower to outweigh the disadvantages of adding children as joint tenants, as well. However, if you still want to do this, it is recommended to seek professional advice. There are legal means to allow you to transfer your property into joint tenancy with some protection, but this must be done on a case-by case basis.

For more information, call or text us today for a consultation at 604 283 8622 or email


Leave a Reply