How to get started with joint bank accounts
How do you open a joint bank account?
Opening a joint account requires almost the same process as opening an individual account. The only difference is that both applicants must provide ID to give the bank access to their personal information.
Here are some things to consider while opening a joint account:
- Setting up online banking
- Deciding on the account authority (‘either to sign’, or ‘both to sign’)
Who can open a joint bank account?
Anyone with an Australian residential address, who is 14 years or older, can apply for a joint account. You must both be opening this account under your names (not under a Company name or Trust account). You must also pass ID verification.
Who pays taxes on a joint account?
Interest income on a joint bank account is assessed in proportion to “beneficial ownership” of money in the account.
The Australian Taxation Office (ATO) assumes that joint bank account holders beneficially own the total money in equal share unless you have evidence to prove otherwise, such as;
- Who contributes to the account & by how much
- Who withdraws from the account & by how much
- How the account has been used over time by both parties
For joint accounts opened by an adult and a child (under the age of 16), the tax threshold amount is the same as for a single account.
How do you close a joint bank account?
Just like how opening a joint account was similar to opening a single account, closing a joint account works with similar logic. However, this process may require both parties to visit a bank branch, depending on the circumstances.
A form requesting the closure, proof of identity and the approval of both account holders are required to close the account.