NEWLY married couples could be missing out on £252 a year – and a simple 30-second check will tell you if you’re eligible.
Marriage allowance lets you transfer £1,260 of your personal tax allowance to your husband, wife or civil partner.
Workers in the UK have a personal tax-free allowance of £12,570, and once you earn more than this you must pay income tax at the basic rate of 20%.
However, if you’re married or in a civil partnership and you earn below the personal allowance, you can transfer up to 10% of it to your partner.
Your partner must be a basic-rate taxpayer to get this benefit, meaning their annual income is between £12,571 and £50,270.
This can add up to £1,260 to your partner’s personal allowance, which would reduce the amount of tax they pay by £252.
You can reclaim the tax back for up to four years, meaning the benefit could be worth more than £1,000 in total.
Once you apply and are eligible, HMRC will automatically adjust your tax codes to reflect the transfer.
HMRC estimates that 4.2 million couples are eligible for the tax break, but only 2.1million claim it with a further 2.1million missing out.
How to apply for marriage allowance
You can apply for marriage allowance online by visiting the gov.uk website, and it is free to do so.
The partner who earns the least should make the claim.
However, if either of you gets other income, such as dividends or savings, you may need to work out who should claim.
You can call the Income Tax helpline – which you can find on the gov.uk website – if you’re unsure.
Changes to your personal allowances will be backdated to the start of the tax year, which is April 6, if your application is successful.
To be eligible for the allowance the following must apply to your and your spouse:
- You’re married or in a civil partnership.
- You do not pay income tax or your income is below your personal allowance (usually £12,570)
- Your partner pays Income Tax at the basic rate, which usually means their income is between £12,571 and £50,270 before they receive Marriage Allowance
You can also backdate your claim to 6 April 2021 for any years you were eligible for Marriage Allowance.
If you only pay income tax at the basic rate and believe you’ve been wrongly denied marriage tax allowance, you can appeal the decision directly to HMRC.
You and your partner will get new tax codes that reflect the transferred allowance.
Your tax code will end with ‘M’ if you are receiving the allowance and ‘N’ if you are transferring the allowance.
You can read more about tax codes and how they work here.
You’ll need to call the marriage allowance enquiries helpline to speak to an agent and explain the issue.
You must cancel your claim for marriage allowance if you and your partner divorce or your income changes. You can do this online.
Do you have a money problem that needs sorting? Get in touch by emailing money-sm@news.co.uk.
Plus, you can join our Sun Money Chats and Tips Facebook group to share your tips and stories
