Tax on savings
Stewert1dn
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My partner is now retired early and has no income, if I shift all our savings into an account in her name would she be liable for the tax on the savings.
I understand she can earn up to £1000 tax free, but with no income at all would she still be liable for tax on anything above this? TIA for any help.
I understand she can earn up to £1000 tax free, but with no income at all would she still be liable for tax on anything above this? TIA for any help.
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Stewert1dn said:My partner is now retired early and has no income, if I shift all our savings into an account in her name would she be liable for the tax on the savings.
I understand she can earn up to £1000 tax free, but with no income at all would she still be liable for tax on anything above this? TIA for any help.
She has to use her Personal Allowance (£11,310 or £12,570) first.
Then the savings starter rate band where up to £5,000 in interest is taxed at 0%.
And only then can she use the savings nil rate band where up to £1,000 interest is also taxed at 0%.0 

Dazed_and_C0nfused said:Stewert1dn said:My partner is now retired early and has no income, if I shift all our savings into an account in her name would she be liable for the tax on the savings.
I understand she can earn up to £1000 tax free, but with no income at all would she still be liable for tax on anything above this? TIA for any help.
She has to use her Personal Allowance (£11,310 or £12,570) first.
Then the savings starter rate band where up to £5,000 in interest is taxed at 0%.
And only then can she use the savings nil rate band where up to £1,000 interest is also taxed at 0%.
Also not strictly relevant to the question but I would guess that depending on what is meant by “partner” (i.e. are you married or in a civil partnership), there could be IHT implications if you died within 7 years, and also obviously if you put the money in your partner’s name, there is no obligation that they transfer it back to you later if things go south!0 
My uncle has over the years put much of his money into his wifes name apparently to minimise the tax liability between them. As a couple who have had good careers and never had kids they had amassed quite a sum (most in her name). She recently had to go into a care home as he could no longer manage her dementia and power of attorney was put in place. He now finds he cannot access the very substantial sum of money she has other than to pay for legitmate things for her, ie her care home fees. Meanwhile he has hardly any savings to call on for things he wants/needs...and most of the money will end up going the way her will splits it...which is not how his will splits things. Proceed with care and think about unintended consequences.4

Pat38493 said:Dazed_and_C0nfused said:Stewert1dn said:My partner is now retired early and has no income, if I shift all our savings into an account in her name would she be liable for the tax on the savings.
I understand she can earn up to £1000 tax free, but with no income at all would she still be liable for tax on anything above this? TIA for any help.
She has to use her Personal Allowance (£11,310 or £12,570) first.
Then the savings starter rate band where up to £5,000 in interest is taxed at 0%.
And only then can she use the savings nil rate band where up to £1,000 interest is also taxed at 0%.
Also not strictly relevant to the question but I would guess that depending on what is meant by “partner” (i.e. are you married or in a civil partnership), there could be IHT implications if you died within 7 years, and also obviously if you put the money in your partner’s name, there is no obligation that they transfer it back to you later if things go south!0 
Stewert1dn said:Pat38493 said:Dazed_and_C0nfused said:Stewert1dn said:My partner is now retired early and has no income, if I shift all our savings into an account in her name would she be liable for the tax on the savings.
I understand she can earn up to £1000 tax free, but with no income at all would she still be liable for tax on anything above this? TIA for any help.
She has to use her Personal Allowance (£11,310 or £12,570) first.
Then the savings starter rate band where up to £5,000 in interest is taxed at 0%.
And only then can she use the savings nil rate band where up to £1,000 interest is also taxed at 0%.
Also not strictly relevant to the question but I would guess that depending on what is meant by “partner” (i.e. are you married or in a civil partnership), there could be IHT implications if you died within 7 years, and also obviously if you put the money in your partner’s name, there is no obligation that they transfer it back to you later if things go south!
The only other concern would be the one raised about care costs in old age and rules around deliberate deprivation of assets, but it seems like that's not an issue either as you are saying the amounts are not that large anyway.1 
stuhse said:My uncle has over the years put much of his money into his wifes name apparently to minimise the tax liability between them. As a couple who have had good careers and never had kids they had amassed quite a sum (most in her name). She recently had to go into a care home as he could no longer manage her dementia and power of attorney was put in place. He now finds he cannot access the very substantial sum of money she has other than to pay for legitmate things for her, ie her care home fees. Meanwhile he has hardly any savings to call on for things he wants/needs...and most of the money will end up going the way her will splits it...which is not how his will splits things. Proceed with care and think about unintended consequences.
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It does seem unfair that, on the one hand, the savings of both parties in a couple are combined to get to the £16k savings limit but, on the other hand, if one goes into care the savings are treated separately.0

Stewert1dn said:Pat38493 said:Dazed_and_C0nfused said:Stewert1dn said:My partner is now retired early and has no income, if I shift all our savings into an account in her name would she be liable for the tax on the savings.
I understand she can earn up to £1000 tax free, but with no income at all would she still be liable for tax on anything above this? TIA for any help.
She has to use her Personal Allowance (£11,310 or £12,570) first.
Then the savings starter rate band where up to £5,000 in interest is taxed at 0%.
And only then can she use the savings nil rate band where up to £1,000 interest is also taxed at 0%.
Also not strictly relevant to the question but I would guess that depending on what is meant by “partner” (i.e. are you married or in a civil partnership), there could be IHT implications if you died within 7 years, and also obviously if you put the money in your partner’s name, there is no obligation that they transfer it back to you later if things go south!
Ex Sg27 (long forgotten log in details)Massive thank you to those on the long since defunct Matched Betting board.0
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