Our experts at DSR Tax Claims know how hard it is to find good, quality information about HMRC’s tax regulations that is easy to understand, and that’s why we have created these handy guides to tell you everything you need to know. Our aim is to make life easier for our clients and that is why we want to share our expertise with you. You can also call our friendly team on 0330 122 9972 – we’re the tax experts you can trust. Or you can check out our online calculator to see if you could be due a refund.
What is Marriage Allowance?
Marriage Allowance is a form of tax relief, which allows you to transfer some of your tax-free Personal Allowance to your husband, wife or civil partner if they earn more than you. This means that they won’t have to pay as much tax.
If you are eligible for Marriage Allowance, you can transfer £1,150 of your Personal Allowance to your spouse or civil partner, meaning that their tax could be reduced by up to £230 in that tax year. To be able to transfer some of your Personal Allowance, you must have an income of £11,500 or less. You are allowed to backdate your Marriage Allowance claim for up to 4 years. You can still claim the backdated Marriage Allowance if your spouse or civil partner has since died.
Who is eligible to apply for Marriage Allowance?
If all the following apply you are eligible for Marriage Allowance:
- You are married or in a civil partnership
- You earn £11,500 or less, or you don’t earn anything
- Your partner’s income is between £11,501 and £45,000 (£43,000 if you live in Scotland, where Income Tax bands are different to the rest of the UK).
You can still apply even if you or your partner are currently receiving a partner or you both live abroad, as long as you are both entitled to a Personal Allowance.
If either you or your partner were born before 6th April 1935, you might be financially better off if you apply for Married Couple’s Allowance instead. You can’t claim Marriage Allowance and Married Couple’s Allowance at the same time.
How do you apply for Marriage Allowance?
You can apply for Marriage Allowance online from the HMRC website. If your application is successful, your Marriage Allowance tax relief will be backdated to the beginning of the tax year on 6th April.
Your spouse or civil partner will receive their extra Personal Allowance in one of two ways:
- HMRC will change their tax code, which may take up to 2 months
- By claiming it on their Self Assessment tax return, if they are self-employed.
If you are employed or receive a pension, your tax code will also change to reflect your new Personal Allowance, so it will end with an ‘N’.
For as long as you are claiming Marriage Allowance, your Personal Allowance will be automatically transferred to your partner each year until one of you cancels it, or your circumstances change so you are no longer entitled to it, for example if you get divorced.
What happens if your circumstances change?
You or your partner can cancel your Marriage Allowance online. HMRC will ask you to confirm your identity using the information they hold about you.
The date it ends depends on who has cancelled it. If you stop transferring your allowance to your partner, it will continue to run until the end of the tax year on 5th April, at which point it will stop. If your partners asks to stop receiving it, HMRC will backdate the change to the start of the tax year in which you first transferred it.
If you get divorced or end your civil partnership, you can cancel your Marriage Allowance online. HMRC will ask you to confirm your identity using the information they hold about you. If you are the one transferring your Personal Allowance, you can choose to keep transferring it until the end of the tax year or backdate the cancellation to the start of that tax year. If you ask to stop receiving your partner’s Personal Allowance, it will run until the end of the tax year.
If your income changes and you think you are no longer entitled to claim Marriage Allowance, you need to contact HMRC on 0300 200 3300 (textphone 0300 200 3319) to inform them. HMRC will inform you if claiming Marriage Allowance will still benefit you as a couple.
If your partner dies after you have transferred some of your Personal Allowance to them, your Personal Allowance will go back to the normal amount and their estate will be treated as though they had received that extra Personal Allowance. If your partner was the one transferring their allowance to you before they died, you will keep the extra Personal Allowance until the end of that tax year and your partner’s estate will be treated as having the smaller amount of Personal Allowance.
How can DSR Tax Claims help?
We aim to make life as simple as possible for our clients and that includes giving you the information you need to make your taxes (and your life) simpler and less stressful. Our team of experts at DSR Tax Claims are always on hand to help our clients and our excellent standing with HMRC means that we can make sure you don’t fall foul of their regulations, while claiming your maximum tax rebate. We can even take care of all that paperwork and deal with HMRC on your behalf too. Call our friendly team on 0330 122 9972 – we’re the tax experts you can trust.