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Chapter SDLTM00285

Document Cited authorities 1 Cited in Related
Vincent
Published date19 March 2016
Record NumberSDLTM00285
CourtHM Revenue & Customs
IssuerHM Revenue & Customs

Commonhold is a way of owning freehold properties which have communal facilities, such as a block of flats.

A commonhold consists of individual units, such as flats, together with common parts such as lobbies and staircases. Each unit-holder owns the freehold interest in his or her unit and is a member of the commonhold association which owns the freehold interest in, and manages, the common parts.

The intention is to provide an alternative to the long-established practice whereby individual flats in a block are held on long leases granted by the freeholder, either a third party or a company controlled by the flat-owners, and the freeholder manages the common parts.

Commonhold applies only in England & Wales.

Commonhold was created by the Commonhold and Leasehold Reform Act 2002 which was enacted on 27 September 2004.

Commonhold interests have to be registered at the Land Registry. There are more details of commonhold, and of the registration procedure, in Land Registry Practice Guide 60 (LRPG060), which can be found within @ https://www.gov.uk/government/publications/commonhold

Here are two ways in which commonhold land can be registered.

  • Registration with unit-holders. This occurs when an existing freehold and/or leasehold development, for example, an owner-occupied block of flats, is converted to commonhold. The individual owners or lessees will become unit-holders and will each own a freehold interest in their own unit, and any leases they formerly held will come to an end. Each unit-holder will become a member of the commonhold association, which will take over ownership and management of the common parts.
  • Registration without unit-holders. This is designed for new developments. The property is registered as commonhold but the developer continues to be the registered proprietor until the first unit is sold. At that point the unit that is sold is registered in the name of the unit-holder and the common parts are registered in the name of the commonhold association. Further unit-holders are registered as further units are sold.
The Stamp Duty Land Tax...

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