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Posted Tue, 25 Jul 2023 22:28:52 GMT by KuenHK
Hi Sir/Madam, My father has a joint bank account with me for over 10 years before we move in to UK. Actually, that bank account is originally owned by my father (under his name only), but later, when he gets older and he applied to the bank to add my name under this account, and so the sole account has changed to the joint account and been running for more than 10 years. In practice, all money contributions, saving interests, dividends or even losses arisen from that joint account belong to my father. I have no share of any gains/losses from this joint bank account. He operates his account independently. From this situation, I have the following concerns for your kind reply: 1) May I know if I need to report any foreign incomes (saving interests/dividends arisen) from this joint account when I prepare my self-assessment tax return? 2) If I need to do so, how and where can I tell the different share of the foreign incomes arisen from this account? 3) Can it be 0% (me) vs 100% (my father) of incomes to be reported on my self assessment tax return and his self assessment tax return respectively? Thank you.
Posted Wed, 02 Aug 2023 14:47:05 GMT by HMRC Admin 20
Hi KuenHK,

As it is a joint account, it would normally be split 50/50 for any interest that is received. you would therefore need to submit a declaration of trust to show that all interest is attributed to your father and your share is 0. Once this is done, you then do not need to report any foreign interest for that account. You would need to report it for previous years if you were UK resident and domicile.

Thank you.
Posted Wed, 02 Aug 2023 20:53:33 GMT by KuenHK
Thank you for HMRC's reply. In case if I submit the letter of "declaration of trust" together with SA100, SA106 and SA109 (for purpose of split year treatment) as suggested above, I wonder if it will cause to any implications of inheritance tax later when one of the joint holders passes away and all funds from this account pass to its surviving account holder. (Actually, this overseas joint account has a right of survivorship.) Secondly, may I ask if the letter of declaration of trust should be attached with SA100 and SA106 for submission to HMRC each year if the interest share among the joint holders is NOT by 50/50. Please confirm. Thank you.
Posted Tue, 08 Aug 2023 14:01:27 GMT by HMRC Admin 32

Form 17 would also be  required along with the declaratio of trust, to alter the 50/50 split to the beneficially owned split.

Declare beneficial interests in joint property and income

Form 17 must be in HMRC possession withing 60 days of being signed. 

TSEM9860 - Property held jointly by married couples or civil partners: Form 17 rule - when declaration takes effect: normal case

This will remain in place until circumstances change as advised at:

TSEM9864 - Property held jointly by married couples or civil partners: form 17 rule - when a declaration stops

Thank you.
Posted Tue, 08 Aug 2023 22:10:58 GMT by KuenHK
Thank you for HMRC's reply. However, it is noted that the Form 17 does not include (allow) certain circumstances to be declared for. There says "DO NOT fill in the Form 17 about "property held as beneficial joint tenants where you are both jointly entitled to the whole of the property and income"". My situation is just same as the above exception that one of the joint holders (either I or my father) passes away and then the whole income/fund from this joint bank account will pass to its surviving account holder. (Simply, our joint bank account has a right of survivorship --- each is jointly entitled to have the whole of income). As such, may I have HMRC's further advice, please. Secondly, the joint relationship of my case is Neither married couple Nor civil partners. It is, in fact, the father-and-daughter relationship to hold this joint bank account. In this connection, I would like to ask if the declaration of trust is still applicable and required for my case if our beneficial split is not 50/50? And, should I complete the Form 17 as well if it can "really" fit to my current situation of jointly entitlement to the whole of income. For your confirmation or other advice, please. Thirdly, is there any inheritance tax implication if the joint holders are in Father-and-Daughter relationship, not the Married Couple in which no inheritance tax is induced? (PS: Form 17 should be in print and sent out by post to HMRC. So, I wonder if I am allowed to submit my tax return (SA100) via online and then to send out the Form 17 by post. Or, I am told to send out all supporting documents together with paper version of SA100 by one-off post. Please advise as appropriate.) Sorry for the above several queries. Your expert advice is sought, please. Thank you.
Posted Tue, 15 Aug 2023 11:58:01 GMT by HMRC Admin 10
You will therefore need to submit a declaration ot trust signed by both parties and witnessed to show that you have 0% beneficial interest on the bank account.
You need to do this prior to submission of the tax return as you need to have confirmation from HMRC on the date that the new split applies from. For inheritance tax it would be taken into account for the estate.
Posted Fri, 18 Aug 2023 16:03:07 GMT by KuenHK
Thank you for HMRC's reply. I have another concern about the inheritance tax from the joint bank account as below. If the joint bank account is held by the married couple, may I know if there is NO inheritance tax implication for the surviving holder, no matter what is the share split percentage between the holders and the total amount in that account. However, if the joint holders are in Father-and-Daughter relationship, then there will be charged with an inheritance tax if the total estate amount is over GBP325,000, no matter the share split between the holders is 50/50 or 0/100, am I right? Please correct me if the above is inappropriate. Thank you.
Posted Mon, 21 Aug 2023 10:55:12 GMT by HMRC Admin 19

Please contact the Inheritance Tax team for advice.

Inheritance Tax: general enquiries

Thank you.

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