What is a third party account?
A third party account may also be called a ‘convenience’ or ‘agency’ account. This type of account is created when a single account owner authorises another person, who is not an owner, to act as the owner’s third party or assistant. This means that the appointed and authorised third party may withdraw money from your account on your behalf but does not become an owner.
This type of account offers the convenience of allowing the owner and the third party to withdraw money from the account but avoids the risk of loss that may result from the third party’s activities, losses or debts. This type of account arrangement should also end if the owner dies or loses decision-making capacity. It is important to record in writing with the bank or building society that when the account owner dies or if the owner no longer has decision-making capacity the money in the account will be subject to the terms of the owner’s Will.