Jointly Owned Property
Income owned jointly will be taxed 50/50 on both of the owners.
Bank accounts and other jointly owned property
If a bank account is held by one person and at a subsequent date the account becomes a joint account then the income will be split 50/50 from the date the names on the account are amended.
Example: John held a building society account in his own name before he got married on 3 June 2010. From 8 June 2010 the account is held in joint names with his wife. Interest arises on the following dates
| 30 June 2010 | £500 |
| 31 December 2010 | £600 |
| Total | £1,100 |
All the interest arose after 7 June 2010; so the total interest for 2010-11 is split 50/50 between the couple.
Houses/flats held jointly
The 50/50 rule does not apply to income arising from a UK property business which consists of the letting of furnished holiday accommodation.
- If a spouse or civil partner carries on the activity alone: that spouse or civil partner is taxable on the income.
- If a spouse or civil partner carries on the activity with others: the income is split for tax purposes in the way the parties have agreed to split the profits amongst themselves.
The basic 50/50 rule will apply to other property rental income.
It is possible for married couples and civil partners, in certain circumstances, to make a joint declaration of unequal beneficial interests. The form is known as form 17. This form needs to be submitted to HMRC in order to override the 50/50 rule.