You do not own the account. You still have to report it

Figures relate to tax year 2025-26 (UK) · 2025 (US)

You know about the foreign account report. You list your current account, your savings, the old account you keep meaning to close, and you file it every year without much thought.

Then somebody asks about the company account you can sign on, and the running club funds you look after. You own neither. Signature authority is a separate test from ownership, and it catches far more people than expected.

Key takeaways

• Signature authority counts alongside ownership when you test the threshold.
• The power to direct a payment usually creates the duty on its own.
• Employer accounts, club funds and charity accounts all commonly qualify.
• The threshold adds every reportable account together, not each one alone.
• You report the account details without reporting it as your own money.
• Some employees qualify for a narrow exception, and most people do not.

What is signature authority?

Signature authority means the power to control an account, usually by instructing the bank directly. The test asks what you can do rather than what you did, so dormant signature authority still counts. Per IRS guidance, control exercised alone or with others both qualify.

You do not need to have moved a penny during the year.

So the question is about your authority, not your activity.

Which accounts does it catch?

Any foreign account you can direct, wherever the money came from. A business account at your employer, a treasurer's account for a sports club, a charity account you administer, or a parent's account listing your name all commonly fall inside.

Accounts you hold jointly are reportable in their own right anyway.

The rule looks past ownership to signature authority.

A worked example

The figures below are illustrative and use round numbers to show the mechanics.

Mark is an American living in Bristol. He holds a current account with £4,000 and a savings account with £2,000, which together sit well under the threshold.

He is also finance director at a small British company with £180,000 in its bank account, and treasurer of his cycling club with £6,000 in its account.

Adding all four together puts him far past the threshold, so he reports every one of them. Without the work and club accounts, he would have filed nothing at all.

How does the threshold work?

It looks at the highest balance of every reportable account during the year, added together. Cross the line on that combined figure and you report all of them, including the small ones. Nobody gets to leave out an account simply because it held very little.

The test uses the peak balance rather than the closing one.

Our guide to FBAR deadlines and penalties covers the mechanics and the dates.

Which roles commonly qualify

Do you report the money as yours?

No, and that distinction matters. You report the account so the authorities can see it, while a separate box records that you have no financial interest in it. The balance appears on the report without becoming your income or your asset.

It is a disclosure rather than a tax charge.

Nothing about it goes on your income tax return.

Is there an exception for employees?

There is, and it is narrow. A narrow rule excuses certain employees who hold signature authority over an employer's accounts, where the employer itself files and sits inside a large listed group with its own compliance arrangements. Most people working for a small British company get no help from it.

The employer has to be the right kind of entity for it to apply.

Check the detail before relying on it. Assuming it applies is a common and expensive error.

What about a charity or a school?

Trustees and governors regularly end up reporting. If you can instruct the bank, the duty usually follows, and volunteering instead of drawing a salary changes nothing. Small charities meet this rule more often than anyone expects.

A trustee listing with no bank access is a different matter.

Ask what your actual banking permissions are. People often do not know.

What about an elderly parent's account?

Joining a parent's mandate to help with day to day banking creates the same duty. The money is your parent's and the reporting is yours, which feels wrong to people but follows directly from the control test.

A registered power of attorney can have the same effect even before you use it.

Family arrangements are the ones people forget most often.

What information do you need?

The account holder's name, the bank name and address, the account number, and the highest balance during the year. For an account you do not own, you also give details of the owner. Most of it comes straight from a statement.

Ask the organisation early rather than in June.

Ask for the peak figure rather than the year end one. Many organisations only quote the closing balance.

Treasurers changing mid-year need figures from both halves.

Does a business partnership count?

Usually, where you can instruct the bank. Partners in a British firm often share access to the practice account, and each partner with that access reports it separately on their own filing.

The partnership itself may have obligations of its own.

Our guide to a UK LLP and Form 8865 covers the entity side.

What about a pension or an investment account?

Both can count. A workplace pension you direct, a self invested arrangement, and a brokerage account all sit within the definition of a financial account here, which reaches considerably wider than an ordinary current account at a high street bank.

Insurance policies with a cash value can qualify as well.

So a review of everything financial beats a review of bank accounts alone.

Does the company file instead of you?

Rarely in Britain. A foreign company has no American filing obligation of its own here, so the duty lands on the individuals who hold the access rather than on the business.

Employers almost never handle this for their staff.

Assume it is yours to file unless somebody shows you otherwise.

How long should you keep the records?

Five years is the usual expectation, covering the account details, the balances and the evidence behind them. Statements from an organisation you have since left are hard to obtain later, so take copies while you still have access.

A simple annual folder is enough.

Departing treasurers should download the year to date before handing over.

How to work out what you must report

1. List every foreign account you personally own or hold jointly.
2. Add any account at work you can instruct the bank about.
3. Add club, society, charity and school accounts you have access to.
4. Add family accounts you were added to, including under a power of attorney.
5. Find the highest balance each account reached during the year.
6. Convert each to dollars using the published year-end rate.
7. Add them together and compare the total with the threshold.

Does it apply to cryptocurrency accounts?

The position has moved over time and deserves checking for the year you are filing. Accounts holding conventional currency alongside digital assets generally count, while pure digital asset holdings sit in a greyer area.

Our guide to crypto tax across the US and UK covers the wider position.

Where the answer is unclear, reporting costs nothing and silence can cost a great deal.

What if you missed these accounts before?

Correcting it is usually straightforward where nobody underpaid any tax, because an account you merely control produces no income for you. Filing the missing reports with a short explanation is the normal route, and non-wilful failures often escape a penalty.

Coming forward voluntarily matters more than the number of years.

Our guide to delinquent FBAR submission sets out the procedure.

Does leaving the role end the duty?

Only from the point you lose the access. You still report the year in which you held the authority, even if you resigned in March, and the highest balance for that period still applies.

Ask the bank to strike your name from the mandate when you step down.

Plenty of former treasurers stay on the mandate for years afterwards without realising.

Is there a separate asset report as well?

There is, and it works on different rules. The asset disclosure that goes with your tax return looks at what you own rather than what you control, so an account you merely sign on usually stays off it.

The thresholds differ too, and they are far higher for somebody living abroad.

Our guide to Form 8938 and FATCA reporting sets out that side.

What does it cost to get wrong?

Penalties for a non-wilful failure run into thousands of dollars per year, and wilful failures attract far more. The saving grace is that these accounts rarely involve unpaid tax, which keeps the correction route straightforward.

Voluntary correction almost always beats waiting.

The cost of asking the question is an hour of somebody time.

Who else in the organisation is affected?

Any other American with the same access. A British company with three American signatories generates three separate filings, because the duty attaches to each person rather than to the account.

So mention it to colleagues if you spot the issue first.

Boards with several American members often find nobody has filed.

A short note to the finance team usually settles who needs to act.

When is the report due?

It follows the tax return deadline in April, with an automatic extension to October that needs no application. You file it electronically through a separate system rather than with your return.

Many people miss it because it lives outside the usual filing software.

Diarise both dates. The extension is automatic, but the filing is not.

Mistakes and penalties we see with signature authority

The first is ignoring signature authority and counting only your own money. The threshold adds accounts you control to accounts you own.

The second is assuming the employee exception applies. It is far narrower than its reputation.

The third is forgetting the club or the school. Small balances still count towards the total.

The fourth is staying on a mandate after leaving a role. The duty continues while the access does.

How US UK Tax Accountants helps

We work through every account you own and every account you can instruct, test the combined total against the threshold, and file the report with the ownership details recorded properly. Then we set up a checklist you can reuse each year.

Where earlier years went unreported, we handle the catch-up filing. Our streamlined filing service covers wider disclosure work.

If you sign on an account that is not yours, get in touch. It takes one conversation to find out whether it belongs on the report.

Last reviewed 28 September 2026. This article is general information and not personal tax advice. Every arrangement turns on its own facts, so take advice on yours before filing.