What is a right of occupancy trust?


Will trusts can help you manage and protect your property and assets after your death.

A more commonly known discretionary trust is a super popular trust option for parents with young children but here we’re going to explain what a lesser-known ‘right of occupancy trust’ is.

Right of occupancy in a Will UK

If you solely own a property, you will typically bequeath (leave) this property to a beneficiary (the person/s who will inherit from you) in your Will.

Or, you may perhaps instead want your property sold and for the net sale proceeds to form part of your estate for distribution to one or more beneficiaries.

A Will beneficiary (or beneficiaries) can be a spouse, civil partner, common law (cohabiting) partner or a child or children, but can be any other relative or friend of your choosing or even a charity.

However, there may be someone living in your property at the time of your death such as a spouse or child that you don’t want to be turfed out on the street and made homeless, should you predecease (die before) them.

This is where a legal right called a ‘statutory right of occupancy’ can come into play through the medium of a Will trust.

What is statutory right of occupancy?

A ‘statutory right’ is a legal rule that means you are ‘legally entitled’ to do something and a ‘statutory right of occupancy’ means that, as a property owner with legal title to a property, you are legally entitled and have the proprietary right to occupy (live) in your property before and above anyone else.

If you jointly own a property (as joint tenants) then the joint owner equally has this same statutory right to live in the property and they will continue to have this sole right of occupation after a joint owner dies.

However, if you’re the sole owner of a property, then anyone living in your property after you die would not have this statutory right of occupation (the right to continue living there) UNLESS you set up a right of occupancy trust in your Will.

If you choose not to set up a right of occupation trust, the executors of your Will will typically need to put your property up for sale so that the net sale proceeds can be passed on to (or divided up between) one or more beneficiaries in your Will.

So what exactly is a right of occupancy trust?

A right of occupancy trust legally permits a person already living in your property to continue living in your property after you die for as long as you decide (a specified period).

This specified period can be for the rest of their life or until they go into full-time care, or can perhaps be limited to 6 months or a year so the occupant has ample time to find suitable alternative accommodation.

The person you want to convey occupancy rights to can be anyone - a spouse, civil partner, common-law partner, a child, a sibling or an elderly relative. And it doesn’t need to be a blood relative - you may have a dear friend or a lodger living with you that you want to protect from being made homeless should you predecease them.

Very often conditions are attached to an occupancy trust such as the person living there being responsible for paying all the household bills and home insurance.

If you’d like to protect a loved one from beyond the grave and ensure they are never made homeless, you will need to make a Will and set up an occupancy trust.

You can easily and cheaply write a Will online with Wills Services in the comfort of your own home. Our professional Will writing service starts from as little as £29.99 or two [mirror] Wills (popular with couples) start from only £49.99.

If you’d like to know more about writing a will, read our guide: How to make a Will at home

And should you want to discuss setting up a right of occupation trust or any other type of trust, please complete our contact form and one of our legal advisors will contact you for a no-obligation chat.