Jointly Owned Properties Tax Treatment
If you own rental property jointly with someone else — a spouse, sibling, business partner, or anyone else — you only pay tax on your share of the rental income. HMRC needs to know what percentage you own so they can tax you on the right amount.
The rules depend on your relationship with the co-owner and how you've agreed to split the income.
Married couples and civil partners
If you're married or in a civil partnership and living together, HMRC assumes you split rental income and expenses 50/50, regardless of who legally owns the property or how much each person contributed to the purchase.
This is the default position under UK tax law (Income Tax Act 2007, section 836). HMRC treats you as entitled to equal shares of income from jointly held property.
If you own property in unequal shares
If you actually own the property in different proportions — for example, one person owns 75% and the other owns 25% — and you want to be taxed on that basis instead of 50/50, you need to tell HMRC.
You do this by completing Form 17 (Declaration of beneficial interests in joint property and income). Both spouses or civil partners must sign the form.
Once you've completed Form 17, you can update the ownership percentage in Provestor.
Getting help with Form 17
If you're not sure whether you need Form 17, or how to complete it, you can book a tax consultation to speak with one of our tax advisors. They can review your situation and guide you through the process.
Siblings, friends, and other co-owners
If you own property jointly with someone you're not married to or in a civil partnership with — such as siblings, friends, or business partners — you're taxed according to your actual beneficial ownership of the property.
This is usually straightforward:
- You own 50% → You're taxed on 50% of income and expenses
- You own 33.3% (three equal co-owners) → You're taxed on 33.3%
- You own 25% (four equal co-owners) → You're taxed on 25%
Your beneficial ownership is normally set out in your property deeds or purchase agreement. If you're unsure what percentage you own, check your conveyancing documents or speak to your solicitor.
Partnerships
Joint property ownership is not the same as a partnership. Most landlords who co-own property are simply joint owners — they're not in a partnership for tax purposes.
Partnerships are a specific legal structure with different tax reporting requirements, and are currently out of scope for Making Tax Digital.
How this works under Making Tax Digital
Under Making Tax Digital, you must report your share of income and expenses in your quarterly updates and final declaration.
Example: You own a property 50/50 with your sibling. The property generates £12,000 of rental income in a year and has £4,000 of allowable expenses.
- Your sibling reports: £6,000 income, £2,000 expenses
- You report: £6,000 income, £2,000 expenses
Each of you is taxed on your individual share.
HMRC's simplified reporting option
HMRC introduced an easement in January 2025 that allows landlords with jointly owned property to submit income quarterly and expenses annually. This is optional — you can still submit full income and expense breakdowns each quarter if you prefer.
Provestor's recommendation: We recommend full quarterly bookkeeping (income and expenses recorded every quarter) because:
- It gives you a more accurate in-year tax position
- It's just as quick with Provestor's AI categorisation
- You avoid reconstructing expenses at year end
If you do want to use the simplified approach, you can record income each quarter, then add all your expenses before you submit your Q4 update. This keeps your quarterly submissions accurate without needing a year-end adjustment.
Tip
If you use the simplified approach, add expenses before your Q4 submission rather than leaving them for the final declaration, as the process is much easier.
How to set this up in Provestor
When you add a property in Provestor, you enter your ownership percentage. Provestor then automatically calculates your share when you record transactions.
The golden rule: Record the full amount of income or expenses, and Provestor applies your ownership percentage automatically.
Example: You own 50% of a property. Rent of £1,200 is paid by the tenant.
- You record: £1,200 rental income (the full amount)
- Provestor submits to HMRC: £600 (your 50% share)
This keeps record keeping simple and ensures your submissions are accurate.
For detailed guidance on recording transactions for jointly owned properties, see How to record joint ownership income splits.
Common questions
What if ownership changes during the year?
If your ownership percentage changes — for example, you buy out a co-owner — contact Provestor support. We'll update the ownership percentage from the date of the change, ensuring your tax reporting reflects the new split from the right point in the tax year.
Can I have a mix of solely owned and jointly owned properties?
Yes. You can set the ownership percentage individually for each property. This is common for landlords with mixed portfolios — some properties owned outright, others owned with a spouse, and others co-owned with siblings or business partners.
Do I need to coordinate submissions with my co-owner?
No. Each co-owner much keep their own MTD records, and submit their own share independently. You're each responsible for reporting your portion of income and expenses to HMRC through your own Making Tax Digital submissions.