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HMRC internal manual

Trusts, Settlements and Estates Manual

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HM Revenue & Customs
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Ownership and income tax: introduction: income tax principles - joint ownership

Where the property is held in the joint names of a married couple or civil partners, see TSEM9800. Otherwise, the following rules apply.

Joint tenants

Property is held in joint names of A and B. In a joint tenancy, A and B are jointly entitled to the whole of the property. There is no division of the property or the income between the named owners. A and B are jointly entitled to the whole of the income.

For income tax purposes, you tax the income on the joint owners equally. If there are two joint tenants, you tax them on one half each. If there are three owners you tax them on one third each. However, as explained in TSEM9210, it is unlikely that there will be more than two joint tenants.

Tenants in common

Property is held in joint names of A and B. In a tenancy in common, A and B are each entitled to a specific share in the property. For example A is entitled to 25% and B to 75% of the property. The general rule (TSEM9160) is that A is entitled to 25% of income, and B to 75%. The income tax position (TSEM9310) is that A is taxable on 25% of the income, and B is taxable on 75% of the income.