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What tax do we pay on interest from a joint account?

If you have a joint account with your spouse, HMRC has a simple rule to calculate the tax due:

  1. Split the interest down the middle
  2. Apply each spouse’s interest savings allowance to their piece
  3. Pay tax separately.

Example

  • Husband: basic rate taxpayer – gets £1,000 of personal savings allowance
  • Wife: higher rate taxpayer – gets £500 tax-free
  • Interest: £2,000 – half “belongs” to the husband, half to the wife.

Then:

  • Husband pays no tax (uses the entire savings allowance)
  • Wife needs to pay tax on £500 at the higher rate (40%).

What if we don’t want to split the interest 50-50?

You need to prove that you use a different split (for example, one partner put more money in, etc.)

Call HMRC at:

  • If you live in the UK: 0300 200 3300
  • If you live abroad: +44 135 535 9022

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