In New South Wales, a severance of a joint tenancy can be done either by agreement or unilaterally (on your own).
A severance of a joint tenancy takes place when the joint owner transfers his or her interest in the asset ‘to themselves’. Accordingly, there is no stamp duty or CGT payable on the severance.
There are separate Land Registry Services (LRS) forms for the two types of severance. For an agreed severance, you use a ‘Transfer altering tenancy’ (Form 01JT). For a unilateral severance, you use a ‘Transfer severing a joint tenancy’ form (Form 01TJ).
For a unilateral severance, Land Registry Services is required to notify the other owners of your application to sever the joint tenancy, so you must provide the names and postal addresses of the other owners on the Form 01TJ. There is a notice period of 30 days for any co-owners to object to the severance. Once this time has elapsed and if no objections have been received, the Land Registry then registers the unilateral severance.
Evidence of your ownership interest in the property must be provided with each application for severance (whether by agreement or unilateral). If there is a mortgagee on title, then the mortgagee’s consent to the severance will be required.
For assistance changing the ownership of jointly held property to a property held as tenants-in-common, call us on 1300 654 590 or email us.
The information contained in this post is current at the date of editing – 31 October 2022.
