A joint account lets you share money with someone you trust. You’ll both be able to manage the account, including making payments and paying bills. Here’s everything you need to know.
What is a joint bank account?
A joint account normally allows two or more people to:
receive payments, like wages, benefits and pension
pay for things or take out cash with a debit card
transfer money to pay bills or other people, including Direct Debits and standing orders
manage the account using mobile and online banking, over the phone, in branch or at a Post Office (depending on the bank).
If you’re looking to manage someone else’s money, like an older relative, see how to set up a formal arrangement instead – including how to set up a power of attorney.
What to watch out for
A joint account can be a straightforward way to share money and manage living costs, like bills, mortgage and rent payments. But there are some potential disadvantages:
A joint account might damage your credit score
Opening a joint account adds a financial link to the other person. This means companies will look at both of your credit histories as part of any credit checks. If they have a poor credit history, this might lower your chances of acceptance.
You could be responsible for someone else’s debt
Everyone named on the account is equally responsible and can withdraw cash or spend whenever they like. If someone else spends too much and borrows money using an overdraft, the bank could ask you to repay it.
Some banks might offer ‘all to sign’, which means all account holders have to make decisions jointly, but this usually limits you to managing your account in a branch.
Joint accounts are for trusted relationships
If you’re considering a joint account, only do it with someone you trust. For example, you’d have no rights if the other person spent all the money. If you have any doubts, don’t do it.
You can still share bills with separate accounts, just transfer your share to someone – or the other way around. See Should you manage money jointly or separately? for full help.
Protect yourself against financial abuse
Everyone has the right to financial independence. If your partner is controlling your money or running up debts in your name, it’s financial abuse.
Don’t struggle alone, see protecting yourself against financial abuse.
How to open a joint bank account
Most banks will offer joint accounts, but not all. For those that do, you can usually either:
choose to open a new account together
add someone to an account you already have.
Some banks will let you apply for a joint account online, while others would need to see all account holders in a branch. Our compare bank accounts tool helps you view account features, fees and charges.
See our section on How to open, switch and close a bank account for full information, including the ID you’ll need.
Up to £85,000 per person, per banking group is normally protected
Most joint accounts are protected by the Financial Services Compensation Scheme (FSCS). In the unlikely event your bank, building society or credit union were to fail, you’d automatically get your money back – up to £85,000 per person. So two account holders could deposit £170,000 safely.
You can use the FSCS protection checkerOpens in a new window to see if your bank is covered.
If it’s not, it’s likely to be a virtual current account covered by e-money rules. This means your money is kept safe at a different bank, but you’d need to make a claim to the administrator if your provider failed.
Tax on joint accounts
Tax normally only applies if your joint account pays interest. While you won’t pay tax on the cash in the account, you might on the savings interest you receive.
Most people can earn up to £1,000 in savings interest before paying tax, or £500 if you earn £50,271 to £125,140. For a full breakdown, including extra allowances for those earning less than £17,570, see how tax on savings and investments work.
Any interest you earn in a joint account will usually be split equally between each person. So tax will only be due if your share of the interest is above your annual allowance.
Freeze the account if you have a dispute
If you’re having problems with the other account holders, such as a relationship ending, ask your bank to register a dispute and ‘cancel the mandate’. This freezes the account, so no-one can access it or any cash.
The account will only be unlocked when everyone agrees how to split the money. If you can’t, you might have to let the courts decide who gets what.
Find out more in our guide Sort out joint bank accounts, debt, savings and your finances with your ex-partner.
Help with the cost of living
Worrying about money because of rising rents, high energy bills or debt? If so, we’re here to help.
Take the first steps to find your way forward with our guides to help you with the cost of living.
How to close a joint bank account
You can close a joint account at any time, but any overdraft will need to be repaid first.
Some banks need permission from all account holders, while others will let one person close it – provided a dispute hasn’t been registered. So always check with your bank.
You can usually request to close the account:
- via live chat in online or mobile banking
- over the phone
- by post, signing an account closure form
- in branch.
If you all need to agree, everyone will either need to sign the form or contact the bank separately to give their permission.
How to switch a joint account
If you want to change banks, the Current Account Switch Service (CASS) automatically moves your money and payments over.
This works for joint accounts, provided you’re switching to another joint account and all account holders agree. You can also switch an account in just your name to a joint account elsewhere.
See how to open, switch and close a bank account for more information on CASS.
If you want to unlink your finances
Closing a joint account won’t remove the link to the other person from your credit file.
If you no longer have any financial connection to them (so no other joint account, loan or mortgage) you can ask the credit reference agencies to issue a ‘notice of disassociation’. This stops them affecting your future credit applications.
The three to contact are:
What happens if a joint account holder dies?
If an account holder passes away, the joint account will continue in the remaining names.
You can contact your bank directly or use a free service to notify many organisations at once. You’ll normally need to create an account, fill in a form and upload a copy of the death certificate:
- Death Notification ServiceOpens in a new window
- SettldOpens in a new window
- LifeLedgerOpens in a new window
See what to do when someone dies for more help.
Unless you were married or in a civil partnership, you might have to pay tax on some or all of the money in the account. See our guide to Inheritance Tax for more information.
If things go wrong
If you have a problem with your bank or joint account, follow these steps.
ask your bank’s customer services to put things right – if you can’t agree on a resolution, then
make a formal complaint – they have eight weeks to investigate and give a final response. If you still don’t agree, or the timeframe has passed, you can
take your complaint to the free Financial Ombudsman Service – you’ll get an independent decision on whether your bank’s response was fair or if they need to do more.
For more information, see our full how to complain guide.
