Failure to declare unearned income

[corriequeen]

My ex-husband has always paid tax at the standard, lower rate. However, for a number of years (about the last 10) he has received unearned income which means his total gross income for the year would be in the region of £55k (about £40k salary, £15k unearned income). Doesn't this mean that he should have paid the higher rate of tax on a portion of his income?

He has recently been talking about completing a tax return, so if the taxman catches up with him, how far back could the tax owing be backdated? I am worrying that I could be liable for some of it, as we were married until 2009. The unearned income was paid into a joint building society account which had his and my name on it, although the unearned income is nothing to do with me, it comes from a family inheritance on his side of the family.

Can anyone advise - do I have anything to worry about?

[ubasses]

You have to take his whole income for each year take away his tax code, he then pays at the correct rate for each band so if he has basic tax code take away £6475 from the £55,000 he then pays basic rate tax on £37400 and 40% on the rest. So he should owe basic rate on some and higher rate on some of the £15k. The money appears to be paid to him so putting it in a joint account will make no difference. You would only be liable for tax on half of any interest it earned and this is usually deducted at source. So the Tax Office will go back using each years allowances and tax rates to work out how much he owes. This has probably come to light because HMRC have looked at the accounts filed by the Trust.