Joint account tax question

NozzaC

When we sold out house without buying a new one in the last tax year I opened some savings accounts to put the money in. My wife is a high rate earner and I wasn't in that tax year. Stupidly I opened a joint account for some reason and although my wife has never had anything to do with the account from start to finish, now it comes to fill in the self assessment returns I realise I've now made us/her liable for loads more tax.

I assume there is nothing to be done about that? By having her name on the account the tax liability for 1/2 the savings is simply doubled?

Is the following maths correct?: you have savings of £100,000 that produced £5,000 in gross interest in a joint account and one person is at the 20% range and the other is at the 40% range. The bank already takes 20% so the net interest is £4,000 with £1,000 having been taken as tax. Split between the couple that is £500 each. The 20% tax payer pays nothing extra but the 40% tax payer now has to pay out an additional £500?

This is one expensive bit of ignorance...

Mikeyorks

NozzaC wrote: »

The 20% tax payer pays nothing extra but the 40% tax payer now has to pay out an additional £500?

That sums it up. Your wife needs to contact HMRC to declare any interest - if she doesn't already complete an SA Return