Can we vary our income split for tax purposes?
My wife and I own a property as Joint Tenants as opposed to Tenants in Common. As Joint Tenants are we forced to split the income 50% / 50% for tax purposes or can we vary this. Due to our respective incomes it would be more advantageous if we could apportion all of the income to my wife.
Arthur Wellers replies:
In order to achieve what you want, i.e. more of the rental income to be taxed in your wife's name, you need to do two things. Firstly you need to transfer a corresponding proportion of the property into your wife's name, either by formal conveyance, or by deed of trust to transfer beneficial ownership. Secondly within 60 days you need to complete a Form 17 (http://www.hmrc.gov.uk/forms/form17.pdf) and send it into HMRC together with proof of the transfer. The result of this will be your being taxed according to the actual proportion of the ownership, and not on a 50:50 basis.
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