Marc Shoffman
Married couples and civil partners have just weeks to make use of a tax break that could save them up to £252 a year.
More than 2.1 million couples currently benefit from the tax break, which allows husbands, wives and civil partners to transfer part of their tax-free personal allowance to their higher-earning partner.
However, HMRC estimates that 4.2 million couples stand to gain from the tax break, meaning more than 2 million couples could be missing out.
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In addition to this year’s allowance, couples can backdate their claim by up to four tax years - to include any tax year since 5 April 2020 - meaning they could save an extra £1,006 for those years.
March is the most popular month for marriage allowance applications, according to HMRC, as couples rush to claim before the tax year ends on 5 April.
HMRC says many people are unaware they are eligible for the tax perk, particularly couples where one partner has retired, has given up work to take on caring responsibilities, is doing a part-time or low-paid job, or is unable to work due to a long-term health condition.
According to HMRC, about two-thirds of people in their sixties are married or in civil partnerships, and many couples in this age group may not realise they can claim marriage allowance if they have retired and their partner is still working.
“We want every eligible couple to benefit from marriage allowance tax relief,” says Angela MacDonald, HMRC’s deputy chief executive. “Couples whose circumstances have changed – perhaps one of them has stopped working or taken a lower-paid job – may not realise they are entitled to claim.”
HMRC says its online marriage allowance calculator will tell someone if they qualify for the allowance in just 30 seconds.
What is the marriage allowance?
The marriage allowance applies to couples where one partner does not pay income tax - or their income is below the £12,570 personal allowance - and the other partner pays basic-rate income tax.
This means the higher earner's income must be between £12,571 and £50,270 (£43,662 in Scotland).
The couple must be married or in a civil partnership. Cohabiting does not count.
The marriage allowance works by transferring up to £1,260 (10%) of the lower-earning partner’s personal allowance to their spouse or civil partner who earns more. New tax codes are issued reflecting this.
It doesn’t matter if you are currently receiving a pension, or you live abroad - as long as you get a tax-free personal allowance, you can apply.
Both partners must have been born on or after 6 April 1935. If not, you can apply for the married couple’s allowance instead, which is worth between £401 and £1,037.50 a year in tax relief.
How much can I save?
The marriage allowance for the 2024/25 tax year is worth up to £252 a year. The exact amount depends on how much both partners earn. You can check how much you could save by using the government’s marriage allowance calculator.
When part of the personal allowance is transferred, one person may have to pay more tax while the other pays less tax - but the couple will still pay less tax overall.
If you're eligible and apply successfully, you'll automatically get the tax break each year in future, so you don’t need to keep reapplying.
The government will also check to see if you’re owed tax relief for previous years, going back to 2019/20. The maximum amounts for each year are:
- 2024/25 - £252
- 2023/24- £252
- 2022/23 – £252
- 2021/22 – £252
- 2020/21 – £250
So, if you receive the maximum amount for the past four years, you'll receive a lump-sum payment worth £1,006.
Added together with the £252 tax bill saving for the current tax year and couples could save a total of £1,258.
How do I apply?
It’s quick and easy to apply. The non-taxpayer needs to apply, which can be done on the HMRC website. You’ll get an email confirming your application within 24 hours, and a new tax code within a few days if the application is successful.
If there's a problem doing the online application, you can apply via self-assessment (if you’re already registered and send tax returns) or by writing to HMRC. You can also call 0300 200 3300 with any questions.
Make sure you apply for the marriage allowance on the official site, and don’t be tempted to use a third party. Beware searching for “marriage allowance” online, as some firms may charge you for applying.
The fees can be as high as 48% of the value of the tax relief, meaning you could lose almost half of the tax benefit.
Remember that it is free to apply on the government site.
“By applying on gov.uk, rather than through a third party, you get to keep 100% of the tax relief due,” notes MacDonald.
Also watch out for scams. If you’re unsure about a text claiming to be from HMRC forward it to 60599, or if it's an email, send it on to phishing@hmrc.gov.uk.
If your circumstances change and you’re no longer entitled to marriage allowance, you can cancel online or by calling HMRC.
Watch out for an unexpected tax bill if you receive the full state pension and your income exceeds your shrunken personal allowance (as a result of the marriage allowance). Find out more in Pensioners face “marriage allowance mayhem” due to rising state pension.
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