Interest in a property 16:37 Jan 31, 2021
What is the legal interest in a property? The legal interest in a property refers to the right to possess or use property. It belongs to the legal owner, ie the person who is registered at the Land Registry on the title deeds. Legal interest gives the owner a right of control over the property, which means they can decide to sell or transfer the property.
What is the beneficial interest in a property? The beneficial interest is an interest in the economic benefit of a property. It belongs to the beneficial owner, who is entitled to the financial value of the land, regardless of the title entries at the Land Registry.
In particular, beneficial interest gives right to:
live in the property a share of the rental income a share of the proceeds of sale if the property is sold
The legal owner and the beneficial owner of land may be the same person, but not necessarily. In particular, legal ownership and beneficial ownership will be separated when two people decide to manage property through a trust: the legal owner - whose name is registered at the Land Registry - holds the property 'on trust' for the benefit of someone else, the beneficial owner. |