Barclays has clarified the rules when it comes to a tax check that it is obliged to carry out for all customers.
A confused customer contacted the bank as they had received a letter asking them to confirm some details.
They queried: “Why have I received a letter from you to prove my granddaughter’s age, residency, tax status when she’s only 7 years old and I’m in charge of her ISA account like all my grandkids?”
The frustrated grandparent added: “You opened the account for us years ago, so you have her details.”
Barclays responded to express sympathy with the person’s concerns and to state that they were legally duty-bound to request the information.
The bank explained: “We’re obliged under tax regulation by law to record tax residency info for all of our customers, including minors, even if they aren’t required to pay tax.
“The form provided will still need to be filled out by the trustee/parent using the minors details, in this case your granddaughter’s details.”
The customer was told they would also have to provide some details. The savings provider said: “As the account is under your name, there will also be part of the form you’d need to fill out with your details in as well.”
They went on to say the spaces the grandparent would need to complete would be under the ‘Capacity section’.
Barclays added: “Once the form has been filled out, you can pop it back into the envelope you’ve shown in your message and the team will update everything.”
The bank states on its website that in line with tax regulations, all financial institutions have to find out the tax residency details of all account holders.
Savings providers also have identify any possible tax-related connections a customer may have with any other countries and to report the information to the relevant tax authorities.
The group states: “This requirement results from international agreements designed to help tax authorities address tax evasion.
“This is particularly relevant if someone holds assets in countries where they’re not tax resident and may not be declaring those assets, or income, in their residence territory.
“Under these agreements, Governments will exchange information about these assets and income with the residence territory.”
