Use of Form 17 to apportion income on Jointly Owned Property

pjclar02

00ec25 wrote: »

So what you are saying is that a deed of trust addresses the requirement that the (form 17) declaration must reflect reality for married couples?
http://www.hmrc.gov.uk/manuals/tsemmanual/tsem9850.htm

"Married couples do not have a general option to have income taxed in any way they like. They can depart from the standard 50/50 split for tax purposes only where
a) each spouse is in fact entitled to a share other than 50/50 in the property and
b) the share that a spouse or civil partner has in the income is the same as their share in the property"

So the deed of trust in effect "converts" the (default) beneficial joint tenancy (arising from the legal share) into the desired beneficial (tenants in common) share.

If so then as we know, the Form 17 declaration is valid as long as that % "share" is the same as the claimed income % and the deed of trust (not a covering letter) is submitted to comprise HMRC's required supporting evidence.
http://www.hmrc.gov.uk/manuals/tsemmanual/tsem9851.htm

Spot on.

Anselld - yes I have done this for myself and my wife (as well as for many clients), and if you search through Taxationweb or Accountingweb this is a fairly common issue. Having done it myself I have a letter at home from HMRC confirming they agree the transfer of beneficial ownership in these circumstances.

TopCatLandlord

Thank you so much for all your input.


What a can of worms!


No wonder my own research resulted in conflicting opinions. Possibly not helped by the 2011 change of form?


Since all I wanted to do was to save my wife having to do a self assessment and to split the income and expenses, needlessly: its all rather complex.

The major downside would appear to be that Capital Gains could not be split so if prices go up by a large amount I may loose out there.


I think I'll just bite the bullet and sign my wife up to self assessment and pay her bill for her.


Maybe I should have bought the property in my name only - my will covers it.


Thanks again.


Tony