Joint Savings.

[pretty_snowdrop]

If I had a savings account with £500,000 ( i wish) and i added my son onto the account, would she automatically keep £250,000 if i died?
If she did, would she pay inheritance tax or CGT on the money?

[mrpeter]

Who is the 'she' in your question? It seems that there are three people in this joint account , you --she-- and your son.

[Buenchico]

Your son appears to have gender issues, Pretty-Snowdrop ;-)

CGT isn't relevant because there's no capital gain to be taxed.

The IHT rules say that money placed into a joint account solely by the deceased person counts wholly towards the value of the estate. See here
http://www.hmrc.gov.uk/inheritancetax/how-to-value-estate/joint-property.htm#3
and here:
http://www.marsdenrawsthorn.com/law-news/2396/Joint_account_can_cause_inheritance_tax_problems

Chris

[KJN]

If you added your son to the account it would then be a joint account and on your death HE (not she) would have control of the whole amount in the account I.e. £500000. As regards taxes on the amount it depends what other assets are involved.

[pretty_snowdrop]

whoops sorry i meant HE.

[Peter Pedant]

There is another link on Law - BuenChic may be able to locate
the account on death of one party is still operable by the other - which is convenient because sole accounts are frozen and unusable on death until probate is granted

however - altho each party can draw on the funds - the ownership is partitioned (divided) as to who contributed - see BuenChic

this is as a result of a recent ish case

rather obvious really - but defeated my family for one.

With spouses who are usually the joint owners - this doesnt really arise as transfer between spouses (but not parent and child) are IHT- free

simples

[Peter Pedant]

two excellent refs from BuenChoc that says it all

and wh even mentions the case - Smith v HMRC
but wh I can only find Aroso ...... Northall v HMRC is there somewhere