Income Tax Act 2007

Chapter 3 U.K. Jointly held property

836 Jointly held property U.K.

(1) This section applies if income arises from property held in the names of individuals—

(a) who are married to, or are civil partners of, each other, and

(b) who live together.

(2) The individuals are treated for income tax purposes as beneficially entitled to the income in equal shares.

(3) But this treatment does not apply in relation to any income within any of the following exceptions.

Exception A

Income to which neither of the individuals is beneficially entitled.

Exception B

Income in relation to which a declaration by the individuals under section 837 has effect (unequal beneficial interests).

Exception C

Income to which Part 9 of ITTOIA 2005 applies (partnerships).

Exception D

Income arising from a UK property business which consists of, or so far as it includes, the commercial letting of furnished holiday accommodation (within the meaning of Chapter 6 of Part 3 of ITTOIA 2005).

Exception E

Income consisting of a distribution arising from property consisting of—

(a) shares in or securities of a close company to which one of the individuals is beneficially entitled to the exclusion of the other, or

(b) such shares or securities to which the individuals are beneficially entitled in equal or unequal shares.

“Shares” and “securities” have the same meaning as in section 254 of ICTA.

Exception F

Income to which one of the individuals is beneficially entitled so far as it is treated as a result of any other provision of the Income Tax Acts as—

(a) the income of the other individual, or

(b) the income of a third party.

837 Jointly held property: declarations of unequal beneficial interests U.K.

(1) The individuals may make a joint declaration under this section if—

(a) one of them is beneficially entitled to the income to the exclusion of the other, or

(b) they are beneficially entitled to the income in unequal shares,

and their beneficial interests in the income correspond to their beneficial interests in the property from which it arises.

(2) The declaration must state the beneficial interests of the individuals in—

(a) the income to which the declaration relates, and

(b) the property from which that income arises.

(3) The declaration has effect only if notice of it is given to an officer of Revenue and Customs—

(a) in such form and manner as the Commissioners for Her Majesty's Revenue and Customs may prescribe, and

(b) within the period of 60 days beginning with the date of the declaration.

(4) The declaration has effect in relation to income arising on or after the date of the declaration.

(5) The declaration continues to have effect until such time (if any) as there is a change in the beneficial interests of the individuals in either—

(a) the income to which the declaration relates, or

(b) the property from which that income arises.