What is a Declaration of Trust?
A Declaration of Trust — sometimes called a Deed of Trust — is a legal document that sets out how a property is owned between two or more people. It records each owner's share of the property, what happens if one person wants to sell, and how the property should be dealt with if the owners separate or one of them dies.
A Declaration of Trust is used where property is owned as tenants in common — that is, where each owner holds a defined share. It gives both legal clarity and practical protection to everyone involved.
When Do You Need a Declaration of Trust?
A Declaration of Trust is particularly important in the following situations:
- Unequal deposits: If one person contributes more towards the deposit than the other, a Declaration of Trust records that difference and ensures each person gets their contribution back on sale.
- Parent helping with a deposit: If a parent contributes to a deposit for a child and their partner, a Declaration of Trust protects that contribution and records whether it is a gift, a loan or a share in the property.
- Unmarried couples: Without the legal protections of marriage, a Declaration of Trust gives each partner certainty about their share of the property regardless of what happens to the relationship.
- Friends or relatives buying together: Where two or more people who are not a couple buy a property together, a Declaration of Trust records how costs, maintenance and eventual sale proceeds should be divided.
- Protecting against future disputes: A written agreement reached at the time of purchase is far easier to rely on than trying to reconstruct an oral agreement years later.
What Does a Declaration of Trust Contain?
A well-prepared Declaration of Trust typically covers:
- The full address and Land Registry title number of the property
- The name and address of each owner
- Each owner's percentage share of the property
- How much each owner contributed to the deposit
- How mortgage payments, maintenance costs and other expenses are shared
- What happens if one owner wants to sell their share
- What happens if the relationship breaks down or one owner dies
- How the net proceeds of sale are divided when the property is sold
Does the Property Need to be Tenants in Common?
Yes. A Declaration of Trust only works properly if the property is owned as tenants in common, not joint tenants. If your property is currently owned as joint tenants, you will need to serve a Notice of Severance first to change the ownership type before a Declaration of Trust takes effect.
If you are not certain how your property is owned, we offer a Title Register Check for £10 to confirm this. If a Notice of Severance is needed, we can prepare this for £49.
Once we have confirmed ownership is tenants in common, or once the Notice of Severance has been served, your Declaration of Trust can be prepared.
What a Declaration of Trust Cannot Do
A Declaration of Trust records your beneficial interests in the property — that is, who owns what share financially. It does not change who is named on the mortgage. All mortgage holders remain jointly and severally liable for the mortgage debt regardless of what the Declaration of Trust says. If one owner stops paying their share of the mortgage, the lender can pursue the other for the full amount.
If you have a mortgage on the property, you should let your lender know you are entering into a Declaration of Trust. In some cases your mortgage terms may require consent. We strongly recommend checking with your mortgage lender and seeking independent legal advice before proceeding.
Need a Declaration of Trust?
Protect your share of a jointly owned property. Prepared by a qualified paralegal for £79, delivered within 48 hours.
Order a Declaration of Trust — £79