When two or more people buy property together in Ontario, they must choose how to hold title: as joint tenants or as tenants in common. Joint tenancy gives each owner an equal, undivided interest with an automatic right of survivorship, meaning a deceased owner's share passes directly to the surviving owner outside of the estate. Tenancy in common allows owners to hold unequal shares, and each owner's share forms part of their estate upon death, passing according to their will or Ontario's intestacy rules.
The right of survivorship is the defining feature of joint tenancy. When one joint tenant dies, their interest does not go through probate and cannot be redirected by their will. The surviving co-owner simply continues as the sole owner. Because the property bypasses the estate, it is not subject to Ontario's Estate Administration Tax, which is charged at a rate of 1.5 percent on estate values above $50,000. This makes joint tenancy a common choice for married couples purchasing a principal residence.
Tenancy in common works differently. Co-owners can hold any percentage of the property, such as a 60/40 or 70/30 split, which is useful when contributions to the purchase price are unequal. There is no right of survivorship. When a tenant in common dies, their share enters their estate and is distributed to their beneficiaries. That share will be subject to Estate Administration Tax if probate is required. Tenancy in common is more common among friends, siblings, or investment partners who want to preserve individual control over what happens to their portion of the property.
One important Ontario default to be aware of: under the Conveyancing and Law of Property Act, if the title documents do not explicitly state that the owners are joint tenants, the law presumes a tenancy in common. Your real estate lawyer will confirm the ownership structure when preparing the transfer documents before closing.
It is also possible to change the structure after purchase. A joint tenancy can be severed and converted into a tenancy in common unilaterally by one co-owner, without the other's consent, by registering a transfer on title. This is sometimes done during a separation or as part of estate planning for blended families. Converting from tenancy in common to joint tenancy, however, requires the agreement of all co-owners.
The choice between these two structures has lasting legal and financial consequences. It should align with your will, your estate plan, and your goals for the property. Your lawyer can advise on which structure fits your situation.
