use unemployed partner to avoid paying tax on savings interest?

artyboy

…that is all

jimjames

https://forums.moneysavingexpert.com/discussion/comment/81895482#Comment_81895482

Except it's a "not wife" which makes a significant difference

Albermarle

https://forums.moneysavingexpert.com/discussion/6656485/use-unemployed-partner-to-avoid-paying-tax-on-savings-interest

We often see on the forum people making bad decisions, just to try and avoid paying some tax.

In some cases at least it is easier/better just to pay the tax, rather than potentially bringing on a lot of new problems.

MyRealNameToo

https://forums.moneysavingexpert.com/discussion/comment/81895251#Comment_81895251

You can give your money to whoever you want, as long as they arent a sanctioned persons or a terrorist. If you die within 7 years there can be some complications but its just that your estate is calculated as if the money was still there (at least in part) for IHT purposes.

As soon as you give it to them it becomes theirs, they can invest it, spend it, give it to their other partner as it's theirs and you have no say in the matter. If you were married and split then things would be shared out appropriately but as an unmarried couple you generally just take what's yours and debate over the joint purchases which cash in a sole bank account isnt.

She will need to declare her savings, if thats what she does with it, and it could impact her benefits but then she may decide to spend it something else.

There are a few circumstances where potentially having intentionally deprived yourself of assets can mean you are no longer entitled to state funded care etc but suspect you arent at that age yet.

Newbie_John

Same applies, but little bit safer - open a joint account and if it earns £500 interests - £250 will count towards your tax allowance and £250 towards theirs.

Angelica123

How much tax are we talking about? How much money do you currently have earning interest? Have you maximised your ISA allowance?

Albermarle

https://forums.moneysavingexpert.com/discussion/comment/81895897#Comment_81895897

Problem is that normally either party can withdraw from a joint account, without informing the other. So maybe it feels a bit safer, and you would be more aware of what was going on, but still one party could withdraw the lot and scarper.

I think you can get joint accounts where both have to agree to withdraw, but that would mean having a branch based account and going to sign. So almost certainly a worse interest rate, which would defeat the object.

Newbie_John

https://forums.moneysavingexpert.com/discussion/comment/81895933#Comment_81895933

I will assume you always have a consent of your partner.

You can open a joint account without partner even knowing about it - to prevent withdrawals you can put the money into a fixed term saving account.

I've done a lot of that recently between me and my wife doing small pots for holidays etc. She doesn't really care (has no time for it). In Nationwide it's couple of clicks online.

Section62

https://forums.moneysavingexpert.com/discussion/comment/81896056#Comment_81896056

Opening and operating an account in the name of a partner without telling them could put you on the slippery slope of 'financial abuse'.

For the sake of avoiding a bit of tax, it wouldn't be a good idea.

Newbie_John

It's a joint account in both names and there is a consent of the other partner.