New rules for dormant accounts
A set of FAQ’s has been published by HMRC on the new rules for dormant bank accounts. The Dormant Bank and Building Society Accounts Act 2008 received Royal Assent last November. The scheme is designed to make use of monies held in dormant bank accounts for the benefit of social and environmental community projects. The account holder retains the rights to repayment although this will be made to the reclaim fund if the monies have already been transferred.
A dormant account is defined as an account which has been continually open for at least fifteen years and during which time no transactions have been carried out by the account holder or at his / her instruction.
The FAQ’s include details of which banks can participate in the scheme, how interest is to be calculated and whether interest can be paid gross where a form R85 is held for an account.