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HMRC internal manual

Inheritance Tax Manual

Types of joint property in Scottish law: common property

The main points to remember about this kind of joint ownership situation are:

  • It falls into two distinct types - property passing by survivorship (IHTM15081) and property passing by Will (IHTM12041) or intestacy (IHTM12101).
  • If assets are taken in joint names ‘and the survivor’, or if there is any mention of survivorship in the deeds to heritable (IHTM23001) property, the share of the first to die may pass by survivorship to the other joint owners. This is called special destination (IHTM15050)) if the destination was contractual. The destination will be regarded as contractual if each of the owners has provided part of the purchase price.
  • If there is no mention of special destination or survivorship so that the property is in just the names of the joint owners, the share of each owner will pass by their Will or intestacy.
  • Where there is a special destination it may be possible to revoke (IHTM15050) or ‘evacuate’ the destination so that it no longer applies. But the matter is complex, especially where the joint owners have paid equally for assets. Each situation will need to be considered on its facts and should only be considered where it will have a bearing on the amount of tax to be paid
  • Separate rules apply to money in a bank or building society. The terms in which joint accounts (IHTM15051) are held cannot by themselves effect a change of ownership or amount to a special destination. (IHTM15054)