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HMRC internal manual

Trusts, Settlements and Estates Manual

Property held jointly by married couples or civil partners: The 50/50 rule: 50/50 rule and exclusions

Income from property held jointly by married couples and civil partners is treated as beneficially owned by the individuals in equal shares under ITA/S836. Consequently they are taxable on the income 50/50. This rule applies even if the individuals own the property in unequal shares. It can be disapplied only by a declaration on form 17 under ITA/S837. Full details of how the 50/50 rule operates in practice are given at TSEM9828-9840.

There are some specific exclusions from the 50/50 rule about income. The 50/50 rule does not apply to

  • income to which neither of the individuals is beneficially entitled (TSEM9816)
  • partnership income (TSEM9818)
  • income arising from the commercial letting of furnished holiday accommodation (TSEM9820)
  • income from jointly held shares in a close company (TSEM9822)
  • TSEM9824
  • income in relation to which a declaration by the individuals under section 837 has effect (unequal beneficial interests) (TSEM9826)