21/03/2023
MARRIAGE TAX ALLOWANCE
What is the marriage tax allowance and who can get it?
The marriage tax allowance allows you to transfer £1,260 of your personal allowance (the amount you can earn tax-free each tax year) to your spouse or civil partner if they earn more than you.
If your claim is successful, it will lower the higher earner's tax bill for the tax year, but you can also backdate your claim if eligible. Only people with specific circumstances will be able to apply:
You need to be married or in a civil partnership. Just living together doesn't count.
One of you needs to be a non-taxpayer. This usually means you'll earn less than the £12,570 personal allowance between 6 April 2022 and 5 April 2023.
The other partner needs to be a basic 20% rate taxpayer. This means you'd normally need to earn less than £50,270, or if you live in Scotland, £43,662. Higher or additional-rate taxpayers aren't eligible for this allowance.
You both must have been born on or after 6 April 1935. If not, there's a different tax perk.
In a nutshell, one of you must be a non-taxpayer and one must be a basic-rate taxpayer.
Not sure if you're a non-taxpayer?
In rare circumstances, your personal allowance (the amount you can earn tax-free) may be different to the amounts above, but your tax code letter will tell you. This could be because you have a company car, you owe tax or your savings interest takes you over the threshold.
Taxpaying partner earning just over £50,270?
Marriage tax allowance has the effect of reducing the amount of tax your spouse or civil partner needs to pay.
However, while this is a result of transferring a portion of your personal allowance to your spouse, technically this transfer doesn't increase the threshold at which they'd need to start paying higher rate tax, nor does it increase their own amount of personal allowance.
This distinction is important as it means anybody currently earning slightly over £50,270 can't qualify for marriage tax allowance on the basis that a personal allowance transfer would bring them to within the band of basic rate tax.
As stated above, the basic rate taxpayer will need to be earning less than £50,270 in order to qualify.
Marriage tax allowance
Get a tax break worth up to £1,250
Kit Sproson
Kit Sproson | Edited by Martin Lewis
Updated 3 January 2023
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If you're married or in a civil partnership, you may be entitled to a £1,250 tax break called the marriage tax allowance – something 2.4 million qualifying couples miss out on. It's really easy to apply and take advantage of this tax break. This guide walks you through how to do it.
WARNING: Beware googling 'marriage tax allowance'. Some shyster firms will charge you for applying (they try to look official), but it's FREE to apply. Follow our guide and the correct links below to do it safely and at no cost.
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What is the marriage tax allowance and who can get it?
The marriage tax allowance allows you to transfer £1,260 of your personal allowance (the amount you can earn tax-free each tax year) to your spouse or civil partner if they earn more than you.
If your claim is successful, it will lower the higher earner's tax bill for the tax year, but you can also backdate your claim if eligible. Only people with specific circumstances will be able to apply:
You need to be married or in a civil partnership. Just living together doesn't count.
One of you needs to be a non-taxpayer. This usually means you'll earn less than the £12,570 personal allowance between 6 April 2022 and 5 April 2023.
The other partner needs to be a basic 20% rate taxpayer. This means you'd normally need to earn less than £50,270, or if you live in Scotland, £43,662. Higher or additional-rate taxpayers aren't eligible for this allowance.
You both must have been born on or after 6 April 1935. If not, there's a different tax perk.
In a nutshell, one of you must be a non-taxpayer and one must be a basic-rate taxpayer.
Not sure if you're a non-taxpayer?
In rare circumstances, your personal allowance (the amount you can earn tax-free) may be different to the amounts above, but your tax code letter will tell you. This could be because you have a company car, you owe tax or your savings interest takes you over the threshold (see savings interest). For more guidance on tax codes, see our Free Tax Code Calculator.
Taxpaying partner earning just over £50,270?
Marriage tax allowance has the effect of reducing the amount of tax your spouse or civil partner needs to pay.
However, while this is a result of transferring a portion of your personal allowance to your spouse, technically this transfer doesn't increase the threshold at which they'd need to start paying higher rate tax, nor does it increase their own amount of personal allowance.
This distinction is important as it means anybody currently earning slightly over £50,270 can't qualify for marriage tax allowance on the basis that a personal allowance transfer would bring them to within the band of basic rate tax.
As stated above, the basic rate taxpayer will need to be earning less than £50,270 in order to qualify.
Increasing your pension contributions might make you eligible though
How much can I get?
Marriage tax allowance for the 2022/23 tax year is worth up to £252. If you're eligible and apply successfully, you'll also automatically get the tax break each year going forward – so no need to keep reapplying.
In addition to the current year's allowance, you can backdate your claim by up to four tax years too (currently 2018/19, 2019/20, 2020/21 and 2021/22). The amounts for each year are worth up to:
2022/23 – £252
2021/22 – £252
2020/21 – £250
2019/20 – £250
2018/19 – £238
This means that if you claim for this tax year and backdate the maximum four years, you'll get up to £1,242. You won't have to tick any boxes or make a special request for this – it'll happen automatically.
How the marriage tax allowance is calculated
The partner who has an unused amount of personal allowance can transfer £1,260 of their allowance to the other (so basically 10% of the full allowance). They can only transfer £1,260 – no more, no less.
This is how it works:
Part-time Peter works just enough and earns £5,000 at his local fish and chip shop. His full personal allowance for the year is £12,570, so he has plenty of spare allowance to transfer £1,260 to his wife.
Peter's wife, full-time Fiona, is a software developer. She earns £35,000 and is a basic-rate taxpayer (higher-rate tax starts at £50,270 for most). Her personal allowance effectively increases by £1,260 to £13,830 when Peter chooses to make his transfer.
So she has an extra £1,260 which she would've paid tax on at 20%, but is now tax-free, so she's £252 up (20% of £1,260).
As always if you need any advice or help applying or just seeing if you and your other half might qualify. GET IN TOUCH.
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