Laura Pomfret - Marriage Allowance
Marriage Allowance could help married couples or people in a civil partnership to save hundreds of pounds per year in tax
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WHAT IS MARRIAGE ALLOWANCE?
Marriage Allowance is a way of letting you transfer up to £1,260 of your Personal Tax Allowance to your husband, wife or civil partner if you earn less than £12,570 a year.
For those who haven't applied for this before, you can backdate this allowance for up to four previous tax years, and as the new tax year begins on the 6th April 2025 you'll lose the ability to backdate your claim for tax year 2020/2021 if you don't get your claim in soon.
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WHO IS ELIGIBLE FOR MARRIAGE ALLOWANCE?
There are three key criteria to be eligible for Marriage Allowance:
- You need to be married, or in a civil partnership. Living together, even if you have children, doesn't count.
- One of you needs to be a non-taxpayer, meaning they'll earn less than £12,570 in the current tax year.
- The other spouse needs to be a basic 20% rate taxpayer, usually meaning they'll earn between £12,570 and £50,270, or £43,662 if they live in Scotland.
Income means all taxable earnings, including pensions, meaning even people drawing a pension may qualify.
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HOW DOES MARRIAGE ALLOWANCE WORK?
Personal Allowance
For people earning less than £100,000 the standard Personal Allowance is £12,570, which is the amount of income you don't have to pay tax on.
After £12,570 the first tax band is called the Basic Rate. Anything you earn between £12,571 and £50,270 or £43,662 in Scotland is taxed at a rate of 20%. There are more tax bands above £50,270 but they don't apply to Marriage Allowance.
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Marriage Allowance
If one person has an income of less than their personal tax allowance of £12,570, then they can transfer up to £1,260 of that unused allowance to their spouse. This increases their allowance by the same amount, meaning that their spouse's basic rate of 20% tax now starts at £13,830 instead of £12,570. At the same time, this also decreases the lower earner's personal allowance to £11,310.
To be eligible for Marriage Allowance, the higher earner has to be within that basic rate band of between £12,570 and £50,270, and the lower earner needs to be earning less than £12,570, however in reality less than that to be able to transfer a tangible amount of personal allowance across that will make a difference.
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HOW MUCH COULD PEOPLE BE ENTITLED TO?
For the current tax year (2024/25), the higher earner that receives the Marriage Allowance could save up to £252 on tax. That's because that £1,260 that's been transferred across would have been subject to 20% tax but is now tax free.
Marriage allowance can be backdated an additional four years as well as the current year, so at the moment that's back to 2020/21, so if you've never claimed Marriage Allowance before, then you should do it before the new tax year starts on April 6th because then the latest backdate year becomes 2024/25 and 2020/21 drops off.
There's a free Marriage Allowance calculator for the current tax year on gov.uk. You can access that .
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HOW CAN PEOPLE APPLY?
The only way to apply is via the Government website or to HMRC by post and it's the person who earns the least that should apply.
You can click to visit the official Government portal and apply for marriage allowance online
If you prefer to apply by post, you can download the forms
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CHANGES IN CIRCUMSTANCES
If your circumstances change and you are no longer eligible for Marriage Allowance, you'll need to cancel it. Changes may include an increase in your income making you no longer eligible, or an end to your relationship because you’ve divorced, no longer in a civil partnership or you're legally separated.
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Nick Stapleton's Scam Warning
As Morning Live viewers get in touch about scams they've spotted related to Marriage Allowance, Scam Interceptors' Nick Stapleton gives his advice on avoiding becoming a target
NICK SAYS:
"The only way to claim this allowance is via HMRC online or by post. Sadly when there's money on offer like this, the scammers aren't very far behind targeting people.
One viewer, Linda got in touch to say that she received a phone call from someone claiming to be from HMRC who knew her personal details, claiming that they could help her get the Marriage Allowance.
Thankfully Linda suspected it might be a scam so she put the phone down, however to have personal information on someone is usually because, at some point, you've filled in a form to sign up for something. These scammers then find this information and use it against you. So always be careful when filling in forms which require a lot of personal information so you know exactly who you're handing your details over to.
Specifically for Marriage Allowance, HMRC confirmed to Morning Live that it does not make cold calls to customers and takes reports of suspicious correspondence very seriously. If a customer is unsure about contact received, they can report it to HMRC by forwarding suspicious emails to phishing@hmrc.gov.uk"
