Can Joint Account Gifts Avoid Inheritance Tax?
17 November 2025
Question by John
My wife and I have a joint bank account. I am 85 and she is 65. Can we avoid inheritance tax on a gift from the joint account in her name?
Answered by Mark Williams
When you make a gift from a joint bank account, HMRC usually assumes each of you is giving in proportion to what you contributed. If that’s unclear, they often treat it as 50/50.
If your wife is expected to live longer than you (which, given your ages, may be likely), it could be more prudent for her to make the gift.
Simply putting the gift in her name doesn’t automatically avoid inheritance tax if the money originally came from you. To remove it from your estate, you’d need to genuinely transfer the funds to her first—into her account with full control—before she then makes the gift.
If the donor dies within seven years, the gift may still count towards their estate for inheritance tax. One way to protect against this risk is to take out a life insurance policy (written in trust) that covers the potential tax liability during the seven-year period.
