Form 17 is an official HMRC document used to declare what the income split will be on a property, which is jointly owned, so that the correct tax payments can be calculated.
This applies to couples who are married or in a civil partnership and both own a share in land or property. However, it is only required if a split is different to the normal 50/50 percentages.
Typically, a property which is jointly owned is split evenly, however if circumstances change or for some reason this does not work for a couple then HMRC must be notified through the completion of the Form 17. This form will outline the agreed structure and will be used to take in to account the tax liabilities required by each person. It is important to note that a Form 17 is required if both parties are UK residents or if the owners are living overseas and renting the property to tenants.
Many homeowners are confused as to what is exactly needed by HMRC, so let’s provide an example. If a property is jointly owned, e.g. the deeds of ownership are in the name of 2 individuals, but the ownership is 70:30 then a declaration is needed to ensure tax liabilities are evenly accounted for. The completion of a Form 17 will officially announce to the HMRC of the property split and the tax required to be paid by each of the homeowners.
If 2 people own a property but the shares are uneven then you must complete a Landlord Form 17.
How do I complete a Form 17?
A Form 17 is available via this link – https://www.gov.uk/government/publications/income-tax-declaration-of-beneficial-interests-in-joint-property-and-income-17. The form will need to be completed online and then printed. The printed copy will need to be submitted directly to the HMRC, so we recommend you also print a second copy for your files. When completing the form you will be asked:
- Details on both property owners to include full name, address, national insurance and tax reference numbers
- Full address of the property which this form relates to
- The beneficial interest applicable to both property owners
- A final declaration signed by both parties
Once a declaration is made to the HMRC the Form 17 needs to be submitted within 60 days, if it is not received within this period then HMRC will consider it as invalid.
If you have any questions regarding the completion of Form 17 or need some help with any aspect of business accountancy our team would be happy to help. Please call us on 01173 700 079 or e-mail hello@steppingstonesaccountancy.co.uk. You can also book a free 20-minute call with Yarka – https://calendly.com/yarka-ssa/20min
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