Tax on interest paid into joint account

Downthedrain

I'm a standard rate taxpayer and my wife pays no tax. I benefit from Marriage Allowance. We each have a monthly income savings account in our own names and she has more savings than I do. Both individual accounts pay the gross interest into our joint current account and she contributes more than I do (70/30 split). What is my tax liability?

soulsaver

BR tax payer with  savings interest less than the 'personal savings allowance', £1000 in the tax year = no tax due on savings interest.

SFindlay

Downthedrain said:

I'm a standard rate taxpayer and my wife pays no tax. I benefit from Marriage Allowance. We each have a monthly income savings account in our own names and she has more savings than I do. Both individual accounts pay the gross interest into our joint current account and she contributes more than I do (70/30 split). What is my tax liability?

Are you meaning tax on interest you earn within your joint current account? If so its 50/50.
If talking about the monthly interest in your own individual savings accounts then each taxed according to own account, it doesnt matter where the interest is paid into it's where it was earnt that counts. 

polymaff

Forget splits and destinations.  Your tax liability is to pay the correct tax on interest earned in your own name.

Downthedrain

Thanks for the replies - I just needed to establish whether tax was payable on the source account or the destination and this clears it up for me.

RG2015

The important thing for tax liability is the name on the account where the interest is earned. Where it subsequently goes is irrelevant as far as the taxman is concerned.

bowlhead99

Downthedrain said:

Thanks for the replies - I just needed to establish whether tax was payable on the source account or the destination and this clears it up for me.

If you think about it, your question is along the lines of:

"I've earned interest on the money I had put in my savings account, if I have it paid into a joint account will my wife share liability for tax on the interest I earned in my savings account?  Or if she earns interest in the money in her savings account, am I responsible for the tax on it if she chooses to pay her income into a joint account"?

"No, the clue to who is responsible for tax on the interest income is in the ... I've earned interest on the money... in my savings account..."

Downthedrain

The aspect that originally caused me to pose the question is that I receive benefit from my wife's interest as soon as it's paid into the joint account and I wanted to be sure this isn't classed as unearned income from my own tax position.