RDRM74200 - Temporary repatriation facility: Scope of designation: Joint accounts
Amounts held in in joint accounts, or jointly held property, for example artwork acquired using pre-6 April 2025 foreign income or gains, can be designated under the temporary repatriation facility (TRF).
In cases where assets or accounts are held jointly by one or more individuals that have been subject to the remittance basis and there are transfers out of that account, it is necessary to analyse the account in order to determine which transfers are taxable remittances, and to determine which account holder is liable to pay any tax due, using the most pragmatic approach that best reflects the reality of the situation (see RDRM33510).
A similar approach should be taken when making designations under the TRF with respect to jointly held assets or accounts. Individuals will need to analyse the account and identify the sources in the account that relate to each individual’s foreign income or gains. They can then make the relevant proportional designations in relation to their own pre-6 April 2025 foreign income and gains in their Self Assessment tax return.
For the designation to be made correctly it may be necessary to analyse any jointly owned account by putting each credit to the account into separate columns, divided between each individual, for each year.
Example
Art collector friends Fiona and Stephen arrive in the UK for the first time on 6 April 2024 and are taxed on the remittance basis for the 2024-25 tax year. They share ownership of a painting by Monet, with Fiona owning 75% and Stephen owning 25% of the value. The painting was purchased in France for £10m in 2014-15 and is displayed in Fiona’s art gallery in Paris.
On 31 March 2025 the painting is sold at auction for £20m realising a total foreign gain of £10m, split £7.5m to Fiona and £2.5m to Stephen. The funds are paid into one overseas account which is held jointly by Stephen and Fiona.
On 6 April 2025 Fiona leaves the UK with no intention of returning. Stephen on the other hand stays in the UK, and though he doesn’t want to remit his foreign gain yet, he decides to designate it under the TRF.
Fiona and Stephen’s joint account is effectively treated as two accounts split 75%:25% respectively. Of Stephen’s share of the proceeds of £5m, 50% (£2.5m) relates to the gain realised on the Monet painting with the other 50% (£2.5m) relating to the original pre-arrival capital used to purchase the painting. Stephen can therefore make a designation in respect of £2.5m of the funds in the joint account in his 2025-26 tax return.
Fiona does not want to remit her foreign gain to the UK and does not intend to return to live in the UK. As Fiona is not resident in the UK for the 2025-26 tax year, she cannot make a designation under the TRF in that year. If Fiona’s circumstances change and she does wish to make a designation, she would need to return to the UK and ensure that she is tax resident in a later tax year during the TRF period.