What is a declaration of trust?
A declaration of trust records who really owns what share of a property and on what terms, even where the legal title suggests otherwise. It is used where contributions were unequal, where a family member helped with a deposit, or where a beneficial owner is not named on the title.
It can also cover the terms: who pays the mortgage and the bills, what happens if one owner wants to sell, how the proceeds are split, and whether a parent's contribution is a gift or a loan.
Where it earns its keep is disputes. Without it, courts reconstruct intention from conduct and recollection, which is expensive and unpredictable. With it, the position is documented from the start.
It is a record of beneficial ownership rather than a full trust settlement, though it has stamp duty and capital gains consequences worth checking. Like most documents in this glossary, its value depends entirely on someone being able to find it a decade later.