With pressure caused by the relentless rise in land and house prices people are starting to buy land as groups of couples or friends. This shares the mortgage load but there are legal and tax issues to think through.
For example, if two couples by land are the will almost certainly want to hold the land as tenants in common rather than as joint tenants. Joint tenancy carries the legal right of survivorship, which means if one of the co-owners dies their share in the estate passes to the remaining co-owners. That is normally precisely what the couples do not want to occur.
If the land has one dwelling on it and the co-owners are all living in the house, what mechanisms will be put in place if one or more of the co-owners what to move? If the some or all of the land is leased out in a situation that is not covered by the rules about having boarders, then there will be a partnership in operation.
This will mean that the associated persons provisions will be relevant if one of the co-owners is in one of the tainting land businesses.
If the land is a larger area, enabling say an additional dwelling to be built on it, issues will arise as to whether the co-owned estate should be divided and the land subdivided. A division and subdivision will amount to a disposal so the timing of those steps will be important. Given the configuration of the land the way the bright-line test and the main home exemption applies becomes complex.
I would suggest that when groups of people are thinking about purchasing as co-owners they need to get advice ahead of time as to what the tax and legal implications are of jointly owning land.