The Marriage Allowance only applies to married couples or civil partners where one partner earns less than the personal allowance threshold of £12,570 meaning the higher-earning spouse can transfer up to £1,260 of their personal allowance to their partner ...
The Marriage Allowance can be a valuable tax relief option for married couples!
This results in a tax reduction of up to £252. However, it is important to note that the recipient of the transferred allowance cannot be a higher-rate taxpayer. To be eligible for the Marriage Allowance, couples must both be born after the 6th of April 1935.
"One partner must also be a UK resident!"
Additionally, they must have been married or in a civil partnership for the entire tax year in which the transfer is made. In the case of divorce or dissolution, the transfer can no longer be claimed.
Up to 10% of a spouse’s or civil partner’s unused personal allowance can be transferred and is set at £1,260, remaining at this level until the 6th of April 2028 due to the personal allowance being frozen until then.
It is also worth noting that the lower-earning partner can still use their full personal allowance, even after receiving the transferred allowance. This means that both partners can potentially benefit from reduced tax bills.
To claim the Marriage Allowance, the lower-earning partner can apply online through the government's website or by phone. The application will require information such as National Insurance numbers and proof of identity. If the application is successful, the tax code for the lower-earning partner will be adjusted accordingly.
"The Marriage Allowance can be a valuable tax relief option for married couples!"
It is important to understand the eligibility criteria and the difference between the Marriage Allowance and the Married Couples' Allowance. With this knowledge, couples can potentially reduce their taxable income and have more money in their pockets.
The marriage allowance is often overlooked, so don't miss out.
Until next time ...
ROGER EDDOWES Business Godparent
Would you like to know more?
If anything I've written in this blog post resonates with you and you'd like to discover more about the marriage allowance, it may be a great idea to call me on 01908 774320 and let's see how I can help.
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Roger trained at Edward Thomas Peirson & Sons in Market Harborough before working at Hartwell & Co, followed by Chancery, as a partner. He started Essendon Accounts and Tax with Helen Beaumont in 2014 as a general practitioner with a hands-on approach.
Roger loves getting his hands dirty, working with emerging, small-to-medium and family businesses to ensure they receive the best possible accountancy advice. Roger utilises an extensive network of business contacts to leverage the best guidance and practical solutions.
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