Lee Sharpe considers the tax implications when spouses or civil partners decide to change their profit shares from a property business.
This article looks at the tax considerations when spouses (or civil partners) change profit shares in their property business. Much depends on whether the business is carried on as a general partnership or ‘merely’ as co-owners, as the special rules for the taxation of joint income for spouses or civil partners do not apply if the business qualifies as a partnership.
The problem of joint ownership between spouses and civil partners
The default position for spouses and civil partners in receipt of joint income is that they be taxed equally thereon (ITA 2007, ss 836, 837), regardless of their respective equitable interests in the income source itself. This can be displaced by the submission of a Form 17 joint declaration, which
