Introduction –how to claim the UK Marriage Allowance
Have you ever wondered if you can claim for the Marriage Tax Allowance or, in other words, apply for the UK Marriage Allowance Transfer? On the other hand, have you never been aware that this exists, or who can claim marriage allowance? The process includes part of your partner’s tax allowance being transferred to you. The claim applies to both marriages and civil partnerships.
There are many questions out there regarding the marriage allowance claim, which include:
- what is the marriage allowance?
- when can you apply for it?
- how does the marriage allowance transfer work?
How much tax can you save
When you claim for the marriage allowance, the transfer is worth up to a £250 saving on the higher earner’s tax bill per year. Although this is not a great amount, it may be worth doing in the case of some couples.
Two separate articles which explain how your personal tax position can be affected in the UK are the UK child benefit tax charge and the student loan repayments.
You might also make a saving via your self-assessment tax return if you have invested into an Enterprise Investment Scheme during the tax year.
It is a common fact, that many people miss out on the Marriage Tax Allowance UK claim. The reason for this is simply due to a lack of awareness on the subject. Your contractor accountant will be able to help check if this could be beneficial for you.
In previous times, the UK Marriage Allowance was brought in by the Coalition Government. Today, both married couples and civil partners are able to claim for this. Therefore, if as a couple you are eligible, you can make a tax saving as you can transfer part of your personal allowance to your spouse or civil partner.
Transferring tax allowance to spouse
This Marriage Tax Allowance UK will allow one partner to transfer part of their Personal Allowance (PA) to the other partner. The transfer is 10% of the lower-earner partner’s PA to the higher-earner.
In 2022/23, the PA is £12,570. Therefore, when you are the lower-earning partner you are able to transfer £1,260 of your personal allowance to your partner. This will result in additional tax relief which, in turn, gives an income tax saving of £250 for the higher earning spouse.
Your entitlement to claim will depend on the income of both people in the marriage or civil partnership.
When do you qualify for the UK Marriage Allowance transfer?
To be eligible for marriage allowance transfer, you must satisfy the following criteria:
- You are married or in a civil partnership
- You were both born after 5 April 1935. If one or both of the couple were born before this date, you will need to claim for the ‘married couple’s allowance’ instead
- One partner will have total taxable income below the personal allowance of £12,570. Your total taxable income includes any salaries, self-employment profits, dividends, other taxable income, job seekers allowance and state pension. The second partner will be earning more than the personal allowance and be paying income tax at the basic rate of tax however they will not be in the higher rates tax bracket (income above £50,270 in 2022/23).
If you claim for the Marriage Allowance Transfer, the lower income earner will be able to transfer a maximum of precisely 10% of the prevailing PA for the tax year in question.
If the lower income earner does have some taxable income in the form of salary or other income, the amount of personal allowance transfer may be less than the 10% mentioned above.
Applying for the marriage allowance transfer
The UK tax year starts on 6 April therefore if you qualify the best time to do this is soon after this date. Please note, the partner that is making the marriage allowance transfer will need to apply via their HMRC account. Therefore, when you do this, you can ask HMRC to transfer the 10% of your personal allowance to your husband, wife or civil partner.
You can apply for the transfer of the Marriage Allowance UK online via the HMRC website. When you apply, you will need both yours and your partner’s National Insurance number. You will also need proof of ID when you apply. This ID includes your passport, payslip details, and tax credits. In addition, you can also call HMRC on their Income Tax General Enquiries line on 0300 200 3300.
If your application is accepted HMRC, they will issue updated tax codes. These will show the transfer of the UK Marriage Allowance from one partner to the other. HMRC will also update the change to the start of the current tax year.
Furthermore, you can also apply for this via the Self-Assessment service in your HMRC account.
Backdating your claim
The UK marriage allowance came into effect on 6 April 2015. Many couples are not aware thy can claim and as time goes by more couples are realising that they can make a claim for this. In terms of backdating your claim, the good news is that you can do this for up to four years.
Many couples overlook to claim marriage allowance. In fact, many more do not even check if it would be worthwhile to claim for the UK Marriage Allowance. Although this is not a significant amount, it is worth claiming for if you qualify. Please remember, to be eligible, one partner needs to pay tax at basic rate whilst the other will have income under the personal tax allowance and therefore has unused personal allowance. The person who is making the transfer to their husband, wife or civil partner will need to make contact with HMRC to arrange the marriage allowance transfer.
If you are still not sure how to go about this after reading the above, please take the time to speak to your accountant.
If you have had several employments previously in your working life, and you have pension schemes dotted around from these jobs, something that you may be interested in is pension consolidation.
Link to Contractor Advice UK group on