Establishing severance of tenancy requires a number of key steps to be fulfilled in order to be completed successfully and can be a useful tool for maximising capital.

The process is a means for ensuring that the definition of the tenancy does not prevent parents from passing on property without being taxed for it.

This works by changing the status of parents from "joint tenancy" to "tenants in common".

Upon completion of this process the home is still owned by both partners but upon the death of the first spouse, the ownership remains split into halves.

This means one half can be put into a trust fund for children, meaning that half of the value of the home avoids being taxed under the inheritance tax.