savings account

maria111

Hi,
I am thinking of starting a savings account in my son's and my name to put money aside for him to get as an inheritance when i die. If the account is in both of our names will he have to pay inheritance tax on it, or will everything be his?
Also does the same apply to property. If a property is own by two people, if one dies does the property automatically belongs to the one remaining owner? Any tax to pay on it?

thanks
Maria

margaretclare

maria111 wrote:

I am thinking of starting a savings account in my son's and my name to put money aside for him to get as an inheritance when i die. If the account is in both of our names will he have to pay inheritance tax on it, or will everything be his?
Also does the same apply to property. If a property is own by two people, if one dies does the property automatically belongs to the one remaining owner? Any tax to pay on it?

thanks
Maria

Have a look at this:

http://forums.moneysavingexpert.com/showthread.html?t=146127

Margaret Clare

ReportInvestor

Any gift you make to your son will not incur IHT after 7 years, and will incur less then the 40% rate after 3 years.

If the account is a joint account the Revenue will assume the money is held 50:50 unless you tell them otherwise.

In the case of jointly held property, if you had given away half and survived for 7 years, then your son would only pay IHT if his half of the property (added to the rest of your estate) came to more than £285K - which is the IHT tax free allowance.

If your son is under 18 and you gift him money, then the entire account would be liable to your own top rate of tax if the annual income on that account (or accounts) rose to £100+.

maria111

I found the information that I needed,
Thank you for your help.