Joint Bank Accounts for Family Carers - Sensible or Not?

ElectricBeagle

Wednesday 19th November 2025

Good morning. 

I’m interested on people’s thoughts concerning joint bank accounts for family members who care for elderly and disabled people. I have a family member (77yo) who lives abroad who, several years ago, shared a joint bank account with her aunt (100yo) at the time. The sharing of a joint bank account allowed daily functioning from shopping to paying bills to be easier (from their perspective). It also allowed the carer to take action on important things such as car purchase, holidays, private health care. They shared this account for several years and when her aunt passed away, she became the sole owner of the bank account and everything there in. This avoided the paperwork and inheritance tax situation though I must be clear, this was abroad in another European country and made little difference anyway. From their perspective, it made life easier and there was in effect nothing to do from a financial or inheritance tax perspective on the passing of her aunt. 

I’m eager to understand if this would be beneficial for my self and the person I care for here in the UK. I currently already hold a financial power of attorney over their bank accounts and we sit weekly to discuss their finances so they are kept well in the loop. We have lately been discussing the sense in sharing a joint bank account prior to their passing away.  Their finances are also less than the current 2025/26 Inheritance Tax threshold (and slowly decreasing), so I cannot see their estate being taxed upon death. I am also vaguely aware of the 7 year Tax rule prior to death but lack the understanding of how this would come into play if the deceased estate is taxed (not the inheritors) yet yet that wouldn’t seem to apply any way in this particular case. I assume that the person sharing the account (both me or the cared for) could be taxed if they or I passed away within 7 years of opening the account? 

Would there be any benefits, short or long term to us sharing a bank account in your experience or thoughts? Who would the negatives or benefits be for? 

Thank you.

p00hsticks

The main issue I think would be on who funds the account and whether it goes against your obligations as Attorney, which is to always act in the persons best financial interests.  By having a joint account which would be solely funded by the person you are caring for you are effectively taking possession of half the money in the account. 

If you are unlikely to be the sole beneficiary of the estate after the persons death you could also, righlty or wrongly,  face some accusations that you have taken money out of the estate that wasn't really intended for you. 
   
As you say you already have Financial PoA, a better option would be to set up with the bank for you to have authority to access the persons sole account - you can get a debit card as their representative and have access to their account online to make payments. 

born_again

As per above. As you have POA, having a joint account is pointless. 
All you need to do is transfer funds from their account to yours to cover any costs. Any large amounts then keep clear records of amounts & why.

Is the person you care for a family member &/Or do they have other family?
Have they made a will & who is executor of this?

Grumpy_chap

ElectricBeagle said:

We have lately been discussing the sense in sharing a joint bank account

This will create a financial association between the two individuals.

Whichever dies first, the other becomes the owner of the assets in the joint account so this sits outside the Estate.  It may complicate inheritance distribution if that outcome conflicts with the Will.
This has to be considered in the case of either being first to die.

The assets may be considered in the case of relationship breakdown and potential claim by a spurned spouse.

If either of the parties to the joint account seek to claim means-tested benefits, the assets in the joint account may be considered as savings.

ElectricBeagle

born_again said:

As per above. As you have POA, having a joint account is pointless. 
All you need to do is transfer funds from their account to yours to cover any costs. Any large amounts then keep clear records of amounts & why.

Is the person you care for a family member &/Or do they have other family?
Have they made a will & who is executor of this?

Good evening born_again. Thanks for your reply.

They are a family member with no other family. They have made a will which we created last year with people she chose whom she knew. One of whom is a barrister. She was motivated to create a will after her sister died without a will and the headache that ensued resolving that. 

ElectricBeagle

p00hsticks said:

The main issue I think would be on who funds the account and whether it goes against your obligations as Attorney, which is to always act in the persons best financial interests.  By having a joint account which would be solely funded by the person you are caring for you are effectively taking possession of half the money in the account. 

If you are unlikely to be the sole beneficiary of the estate after the persons death you could also, righlty or wrongly,  face some accusations that you have taken money out of the estate that wasn't really intended for you. 
   
As you say you already have Financial PoA, a better option would be to set up with the bank for you to have authority to access the persons sole account - you can get a debit card as their representative and have access to their account online to make payments. 

Good evening p00hsticks

Thanks for your reply. I am by definition the sole beneficiary written into the will at the request of the person I care for. 

ElectricBeagle

Grumpy_chap said:

“ If either of the parties to the joint account seek to claim means-tested benefits, the assets in the joint account may be considered as savings.”

Hi Grump_chap. Thanks for replying. Can you expand on the above statement and give a scenario. If the funds are considered as ‘Savings’ how does that affect the claim for means tested benefits? What are the negatives?

Grumpy_chap

ElectricBeagle said:

Grumpy_chap said:

“ If either of the parties to the joint account seek to claim means-tested benefits, the assets in the joint account may be considered as savings.”

Hi Grump_chap. Thanks for replying. Can you expand on the above statement and give a scenario. If the funds are considered as ‘Savings’ how does that affect the claim for means tested benefits? What are the negatives?

If an individual claims means-tested benefits, then these are reduced once savings exceed £6k and nothing once savings exceed £16k.

ElectricBeagle

p00hsticks said:

The main issue I think would be on who funds the account and whether it goes against your obligations as Attorney, which is to always act in the persons best financial interests.  By having a joint account which would be solely funded by the person you are caring for you are effectively taking possession of half the money in the account. 

If you are unlikely to be the sole beneficiary of the estate after the persons death you could also, righlty or wrongly,  face some accusations that you have taken money out of the estate that wasn't really intended for you. 
   
As you say you already have Financial PoA, a better option would be to set up with the bank for you to have authority to access the persons sole account - you can get a debit card as their representative and have access to their account online to make payments. 

Good morning p00hsticks

All very good points. Your last point is exactly what I do. I carry one of their bank cards in their name to do their weekly shopping (Shopping account) and another of their bank cards to manage their monthly utility bills (Pension & Bills account). This organises and structures their finances so they know where money is coming from and going to. They also check daily their bank account to see spending. 

My main thoughts (or issues I experience) are long term what is best as the person ages and their healthcare needs change and effectively managing their finances now, with consideration for the future of their health. That’s the main reason for asking if Joint Bank accounts for carers are sensible or not, but also considering both the short term and long term aspects. What worked for their aunt doesn’t nessessary work for them. 

One thing that always baffles me, is when asked by an agency or when considering if there is entitlement for a benefit, “what is their source of income?”. Remember I am doing things on their behalf and for their benefit so I don’t want to make a mistake. 

If asked this question and you only lived of savings (Capital) you would just say “I live of savings…” It’s a straight simple answer. Yet when applying for a benefit this is excluded for some and included for others. PIP is clearly a source of income in my view yet (they receive it), yet, as it’s not means tested I have been clearly told not to include that as a source of income. When considering a Tax accountants perspective, I have clearly been told that Capital should not be considered as income but the interest earned on that capital should be considered… unless below the personal threshold. If you earn £5 interest in a year, doing you fill in a tax return for them? On the one hand you want to cross the ‘t’s’ and dot the ‘i’s’ and be totally open and clear so they don’t get into trouble. On the other you are told you’re wasting your time. But that’s a tax perspective, not a Benefits perspective. Declaring on a form that their income is only their State Pension, seems wrong, yet I am repeatedly told not to put PIP or Capital as sources of income. I am always wary of making a mistake when considering what to include or not include when defining ”income”. 

Am I over thinking this or is it reasonable to consider this question in such detail?

Grumpy_chap

ElectricBeagle said:

If asked this question and you only lived of savings (Capital) you would just say “I live of savings…” It’s a straight simple answer. Yet when applying for a benefit this is excluded for some and included for others. PIP is clearly a source of income in my view yet (they receive it), yet, as it’s not means tested I have been clearly told not to include that as a source of income. When considering a Tax accountants perspective, I have clearly been told that Capital should not be considered as income but the interest earned on that capital should be considered… unless below the personal threshold. If you earn £5 interest in a year, doing you fill in a tax return for them? On the one hand you want to cross the ‘t’s’ and dot the ‘i’s’ and be totally open and clear so they don’t get into trouble. On the other you are told you’re wasting your time. But that’s a tax perspective, not a Benefits perspective. Declaring on a form that their income is only their State Pension, seems wrong, yet I am repeatedly told not to put PIP or Capital as sources of income. I am always wary of making a mistake when considering what to include or not include when defining ”income”. 

From a means-tested benefits perspective, income arising from capital cannot be considered as income because that would result in double counting / double penalty.

An individual has income - pension etc.

An individual also has capital / savings.  That can be in any form - so simple bank account savings, ISA, premium bonds, a collection of Grand Master original artwork, shares, second property, cash mattress, gold bullion, whatever.  It all gets considered as a "value" of capital / savings. 
If the savings are below £6k, the value is ignored in considering means-tested benefits
If the savings are between £6k and £16k, the value is considered on a sliding scale to reduce the means-tested benefits.
If the savings are above £16k, the value is considered sufficient to reduce means-tested benefits to zero.

In the band where the means-tested benefits are being tapered, that is because the assessment of means-tested benefits is taking an "assumed income" as being generated from that capital.  So, the capital is not being directly considered but the resultant "assumed income" is already considered as income.  If the actual income arising was considered as well, that would be the double-counting.

Although this is not immediately obvious (to me at least), once it is thought about it does make sense.  It means that capital is treated the same irrespective of how it is held.
£10k of capital is treated exactly the same if it is in a simple interest-bearing bank account or the art collection, even though the bank account is generating an income but the art collection is not.
If it was not like this, some people would seek to transfer capital that is not considered as such for determining means-tested benefits.

ElectricBeagle

Grumpy_chap said:

ElectricBeagle said:

If asked this question and you only lived of savings (Capital) you would just say “I live of savings…” It’s a straight simple answer. Yet when applying for a benefit this is excluded for some and included for others. PIP is clearly a source of income in my view yet (they receive it), yet, as it’s not means tested I have been clearly told not to include that as a source of income. When considering a Tax accountants perspective, I have clearly been told that Capital should not be considered as income but the interest earned on that capital should be considered… unless below the personal threshold. If you earn £5 interest in a year, doing you fill in a tax return for them? On the one hand you want to cross the ‘t’s’ and dot the ‘i’s’ and be totally open and clear so they don’t get into trouble. On the other you are told you’re wasting your time. But that’s a tax perspective, not a Benefits perspective. Declaring on a form that their income is only their State Pension, seems wrong, yet I am repeatedly told not to put PIP or Capital as sources of income. I am always wary of making a mistake when considering what to include or not include when defining ”income”. 

From a means-tested benefits perspective, income arising from capital cannot be considered as income because that would result in double counting / double penalty.

An individual has income - pension etc.

An individual also has capital / savings.  That can be in any form - so simple bank account savings, ISA, premium bonds, a collection of Grand Master original artwork, shares, second property, cash mattress, gold bullion, whatever.  It all gets considered as a "value" of capital / savings. 
If the savings are below £6k, the value is ignored in considering means-tested benefits
If the savings are between £6k and £16k, the value is considered on a sliding scale to reduce the means-tested benefits.
If the savings are above £16k, the value is considered sufficient to reduce means-tested benefits to zero.

In the band where the means-tested benefits are being tapered, that is because the assessment of means-tested benefits is taking an "assumed income" as being generated from that capital.  So, the capital is not being directly considered but the resultant "assumed income" is already considered as income.  If the actual income arising was considered as well, that would be the double-counting.

Although this is not immediately obvious (to me at least), once it is thought about it does make sense.  It means that capital is treated the same irrespective of how it is held.
£10k of capital is treated exactly the same if it is in a simple interest-bearing bank account or the art collection, even though the bank account is generating an income but the art collection is not.
If it was not like this, some people would seek to transfer capital that is not considered as such for determining means-tested benefits.

Wonderful answer! Thank you. I’ve been waiting to hear an answer like that for several years. For me, managing someone else’s health care and finances, it’s imperative to get it right. Not just from the perspective of what they cannot claim or owe, but also what they can that I have missed, or they don’t owe. It also dawns on me how someone can innocently say… “that’s fine” and then years later the DWP or HMRC are chasing you for something you knew nothing about or had sincerely believed was being done correctly. Also inaccurate or wrong payments from the DWP or HMRC, even when you provide the correct information, must play havoc with people’s lives and mental health years later when they receive letters stating “you owe us £xxxx”.  So even when receiving a payment, I tend to triple check from multiple sources, that it is actually the correct amount. 

For me and the person I care for it’s about being as open as possible. Case in point. When they received a gain from selling a share in a property they sold to pay for healthcare, I arranged for their taxes to be paid 14 months in advance plus an overpayment. The Tax accountant thought I had lost the plot. 14 months later they (the cared for) received a refund from HMRC which was pleasant but nothing compared to the relief of knowing everything was above board and correct.  For those with mental health issues, the peace of mind can be far more valuable than the sum of money.   Thanks Grumpy_chap

…and thanks to all on here who reply and use their knowledge and life experience to help others. 👍