Joint Accounts: When A Simple Solution Creates Unexpected Tax Surprises

Your son helps with your finances. Your daughter lives nearby and can deal with the bank. Or perhaps you simply want to make life easier if your health deteriorates.

So, you add their name to your bank account.

Simple? Not necessarily.

What many people do not realise is that adding someone as a co-holder may amount to a gift, alter who inherits the funds on death and trigger unexpected tax consequences. Nor are these issues confined to UK bank accounts. A UK resident individual may face UK tax consequences even where the account itself is located overseas. Equally, non-UK residents may encounter UK tax or succession issues where a UK account is involved.

Indeed, joint accounts frequently feature in cross-border families. Perhaps you live in the UK but hold savings overseas. Perhaps you have moved abroad but retained a UK account. Or perhaps a child who lives in another country has been added to help manage your finances.