When two or more people buy property together in Canada, the title must be held as either joint tenancy or tenants in common. This choice affects what happens when one owner dies, separates, or wants to sell their share. The wrong choice can create unintended tax consequences, estate complications, or leave a partner unprotected.
Quick comparison
| Feature | Joint Tenancy | Tenants in Common |
|---|---|---|
| Ownership shares | Equal (always) | Any split (50/50, 60/40, etc.) |
| Right of survivorship | Yes — share goes to surviving owner automatically | No — share goes through the deceased’s estate |
| Probate required on death | No | Yes (for the deceased’s share) |
| Can sell your share independently | No (must sever first) | Yes |
| Can will your share to someone | No (survivorship overrides the will) | Yes |
| Best for | Spouses and committed partners | Business partners, friends, unequal contributors, estate planning |
How joint tenancy works
All owners hold an equal, undivided interest in the entire property. The “four unities” must be present:
| Unity | Meaning |
|---|---|
| Time | All owners acquired their interest at the same time |
| Title | All owners received title through the same document |
| Interest | All owners hold equal shares |
| Possession | All owners have equal right to possess the entire property |
On death
The deceased owner’s share automatically transfers to the surviving owner(s). This is called the right of survivorship.
| Step | What Happens |
|---|---|
| Owner dies | Share automatically vests in surviving owner(s) |
| Probate | Not required for the property |
| Will | Does not affect the property (survivorship overrides the will) |
| Estate fees | No probate fees on the property |
| Registration | File a survivorship application with the land registry to update title |
Advantages of joint tenancy
| Advantage | Details |
|---|---|
| Simplicity on death | Automatic transfer with minimal paperwork |
| Avoids probate | Saves time and probate fees (up to 1.5% in Ontario) |
| Creditor protection (partial) | While alive, one owner’s creditors may still claim against their interest |
| Equal ownership | Simple for couples who share everything |
Disadvantages of joint tenancy
| Disadvantage | Details |
|---|---|
| Cannot leave your share to someone else | Even if your will says otherwise, survivorship applies |
| Must be equal shares | Cannot reflect unequal contributions |
| Can be severed unilaterally | One owner can sever without the other’s consent |
| Potential tax complications on death | Deemed disposition of the deceased’s share may trigger capital gains (for non-principal-residence properties) |
How tenants in common works
Each owner holds a specific share of the property. Shares can be equal or unequal, and each owner can deal with their share independently.
On death
The deceased owner’s share does not transfer to the other owner — it goes to the deceased’s estate and is distributed according to their will.
| Step | What Happens |
|---|---|
| Owner dies | Share becomes part of the estate |
| Probate | Required (for the property share) |
| Will | Determines who inherits the share |
| Estate fees | Probate fees apply to the value of the share |
| New co-owner | The beneficiary becomes a tenant in common with the surviving owner(s) |
Advantages of tenants in common
| Advantage | Details |
|---|---|
| Unequal shares possible | Reflects different financial contributions |
| Can will your share | Leave to children, other family, etc. |
| Estate planning flexibility | Works with trusts and estate strategies |
| No unintended survivorship | You control who gets your share |
Disadvantages of tenants in common
| Disadvantage | Details |
|---|---|
| No right of survivorship | Surviving owner does not automatically inherit |
| Probate required | Estate fees and delays on death |
| Partition risk | One owner can force a sale through court |
| Complexity | Requires clear documentation of shares and responsibilities |
Which to choose by situation
| Situation | Recommended | Why |
|---|---|---|
| Married couple, first home | Joint tenancy | Automatic survivorship, simple, consistent with matrimonial law |
| Common-law couple, equal contributions | Joint tenancy or 50/50 tenants in common with cohabitation agreement | Either works; tenants in common adds estate flexibility |
| Common-law couple, unequal contributions | Tenants in common (proportional) | Reflects actual contributions; add a cohabitation agreement |
| Parent and adult child | Tenants in common | Parent may want their share to go to other children on death |
| Friends or siblings buying together | Tenants in common | Each controls their share; add a co-ownership agreement |
| Business/investment partners | Tenants in common | Flexibility to sell or transfer individual shares |
| Estate planning (avoiding probate for spouse) | Joint tenancy | Survivorship bypasses probate |
| Estate planning (distributing to multiple heirs) | Tenants in common | Share goes to estate for distribution per the will |
Tax implications
Principal residence
| Scenario | Tax Impact |
|---|---|
| Joint tenancy, one owner dies | No capital gains tax (principal residence exemption applies) |
| Tenants in common, one owner dies | No capital gains tax if it was the deceased’s principal residence |
| Either, property is investment/rental | Deemed disposition on death — capital gains tax on the deceased’s share |
Adding someone to title
| Action | Tax Implication |
|---|---|
| Adding spouse to title | Generally no immediate tax consequence (spousal rollover) |
| Adding adult child to title | May trigger a deemed disposition of 50% of the property — potential capital gains tax |
| Adding anyone to investment property | Deemed disposition at fair market value — likely capital gains tax |
Warning: Adding a child to the title of your home for “estate planning” can have unintended tax, creditor, and family law consequences. Consult a tax accountant and estate lawyer.
Severing a joint tenancy
Any joint tenant can sever the joint tenancy unilaterally — converting it to tenants in common.
| Province | How to Sever |
|---|---|
| Ontario | File a notice to sever at the land registry office |
| BC | Register a separation certificate at the Land Title Office |
| Alberta | Register a transfer to yourself as tenant in common at Land Titles |
| Other provinces | File appropriate documentation at the land registry |
Reasons to sever
| Reason | Details |
|---|---|
| Separation/divorce | Convert to tenants in common to divide the property |
| Estate planning | Want your share to go to children rather than your co-owner |
| Creditor issues | Protecting the other owner’s share from your creditors (limited effectiveness) |
| Changing financial contributions | One owner starts paying more or less |
Protecting yourself with a co-ownership agreement
Regardless of title type, a co-ownership agreement addresses:
| Topic | What to Include |
|---|---|
| Ownership percentages | Who owns what |
| Financial contributions | Down payment, mortgage payments, taxes, insurance, maintenance |
| Decision-making | How renovation and major repair decisions are made |
| Selling | Process for selling, right of first refusal, how proceeds are split |
| Dispute resolution | Mediation before court |
| What happens on separation | Buyout process, timeline, valuation method |
| Death | Complements the will; clarifies intent |