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Should family carers use a joint bank account?

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UKUpdated 6 October 2026 · Written by BuyMeWhiskey Editorial Team · How we check facts

A joint account can work for day-to-day household spending, but for most family carers a third-party mandate or a lasting power of attorney is safer. A joint account makes you a co-owner, links your credit files, passes to you on death outside the will, and can be restricted if your relative loses capacity.

If the person you care for still has mental capacity, make a property and financial affairs lasting power of attorney together on GOV.UK.

Make a lasting power of attorney

Why carers reach for a joint account, and why it's often the wrong tool

When you start helping a parent or partner with shopping, bills and care costs, a joint account feels like the simple fix: you can both pay in and take out. But a joint account makes you a co-owner of the account, not just a helper. That has knock-on effects for debts, credit files, inheritance and family trust. It also may not keep working if the person you care for loses mental capacity, which is often the moment you need it most.

The main drawbacks

It can be restricted when capacity goes. Office of the Public Guardian guidance says that if one joint account holder loses mental capacity, banks can decide to temporarily restrict the account to essential transactions, such as living expenses and care bills, until a deputy is appointed or a power of attorney is registered.
Shared debts. With a joint overdraft or loan, either of you can be asked to repay the full amount, not just half.
Credit files become linked. A joint account creates a financial link at the credit reference agencies. When either of you applies for credit, lenders can look at the other's file too. When the account closes, you can write to the agencies asking to remove the link.
Inheritance can go a different way than intended. Money you own jointly as "joint tenants" passes automatically to the surviving holder. For Inheritance Tax, HMRC normally treats each holder as owning the share they paid in, so if your parent provided all the money, all of it counts in their estate. Brothers and sisters may expect the money to be shared under the will, and that mismatch causes family disputes.
Your money and theirs get mixed. If you pay your own wages in, it becomes hard to show whose money is whose.

Better options, depending on the situation

Third-party mandate: if the person has capacity, they can authorise you to use their own account. You don't become an owner. The OPG says this isn't appropriate if they're losing the ability to make decisions.
Lasting power of attorney (LPA) for property and financial affairs: made while they still have capacity, it lets you manage their accounts and can be used before capacity is lost if they choose. Registration costs £92, or £184 if you also make a health and welfare LPA, unless a reduction or exemption applies.
DWP appointee: if you only need to manage their benefits.
Court of Protection deputy: if they've already lost capacity and there's no LPA.

If a joint account already exists and works well, you don't need to panic and close it. Keep it for household spending only, keep your own money elsewhere, keep receipts, and put an LPA in place while you still can.

Worked example

Jo cares for her mum, who has £30,000 in savings. Jo's brother lives abroad. They're choosing between a joint account and an LPA.

Jo pays about £600 a month for carers and shopping, which is 600 × 12 = £7,200 a year.
If the money sits in a joint account and Mum dies after a year, about £30,000 − £7,200 = £22,800 would be left. As a joint tenant, Jo would inherit it all automatically, even if Mum's will splits everything equally. Her brother would expect 22,800 ÷ 2 = £11,400 and get nothing unless Jo chooses to share.
Because Mum provided all the money, HMRC would count the whole £22,800 in Mum's estate for Inheritance Tax.
If the account had a £500 overdraft, the bank could ask either of them for the full £500.

With an LPA instead, the money stays in Mum's sole account and Jo spends it on Mum's behalf. When Mum dies it passes under her will. Registering the LPA costs £92, which is 92 ÷ 30,000 = about 0.3% of the savings. It keeps working if Mum loses capacity.

Should I open a joint bank account with my elderly parent?#

Think carefully first. A joint account makes you co-owner, links your credit files, can make you liable for any overdraft, and usually passes to you automatically on death, outside their will. A third-party mandate or a lasting power of attorney usually fits a carer's role better.

What happens to a joint account if one person loses mental capacity?#

OPG guidance says the bank can decide to temporarily restrict the account to essential transactions, such as living costs and care bills. That restriction can last until a deputy is appointed or a power of attorney is registered. Tell the bank early rather than waiting for a problem.

Who gets the money in a joint account when one holder dies?#

If you owned it as joint tenants, the survivor inherits it automatically, whatever the will says. For Inheritance Tax, HMRC normally counts the share the person who died paid in. If they provided all the money, all of it counts in their estate.

Is a third-party mandate better than a joint account for a carer?#

Often, yes, while the person still has capacity. A mandate lets you use their account without becoming an owner, so your money and credit file stay separate. But it isn't suitable once they're losing the ability to make decisions, so pair it with an LPA.

Can a joint account affect my credit file?#

Yes. A joint account creates a financial link, and lenders can look at the other person's credit file when either of you applies for credit. After the account is closed, you can ask the credit reference agencies to remove the link.

Am I responsible for an overdraft on a joint account?#

Yes. With a joint overdraft or loan, either holder can be asked to repay the full amount. Both holders usually have to agree to close the account, and the overdraft must be cleared first.

Do I still need a power of attorney if we have a joint account?#

Yes, in most cases. A joint account only covers that account, and it can be restricted if your relative loses capacity. A property and financial affairs LPA covers all their accounts and keeps working, and registration costs £92 unless they qualify for a reduction or exemption.

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Sources

Figures checked against these sources on 6 October 2026. If a rule changes, we update the page and its date.

General information, not personal financial advice. Rules depend on your circumstances; check the official source or speak to a regulated adviser before acting.