Are you married or in a civil partnership? If so you may be entitled to a reduction in tax with something called the marriage allowance. Since being introduced it is expected that over one million couples are still missing out on claiming this.

So… what is marriage allowance and how does it work?

Marriage allowance enables you to transfer £1,190 of your personal allowance to your husband, wife or civil partner – only if they earn more than you.

This would then potentially reduce their tax by £238 over the course of the tax year.

To benefit from the allowance the husband/wife transferring their allowance must earn £11,850 or less.

HMRC are also allowing couples to backdate this to include any tax year since April 2015 that you were eligible for the allowance.

So now you know what it is, who can apply?

If all of the following apply you will be eligible for marriage allowance:

  • You’re married or in a civil partnership
  • One of you earns £11,850 or less or doesn’t earn anything at all
  • The other partner’s income is between £11,851 & £46,350 per year

The following will not affect your application if you and your partner:

  • Live abroad – as long as you still get a personal allowance
  • Are currently receiving a pension


Applying is not as complicated as you may think, here’s how!

You simply apply online on the HMRC website. Should your application be successful then your allowance will be backdated to the start of the tax year so this can be applied or at any point in the tax year.


You’ve applied, so how does the marriage allowance get implemented?

HMRC will give you or your partner the extra allowances through your tax code. The tax code will have an M at the end to signify that you or your partner have been given extra allowances through the marriage allowance.

The partner that has transferred their allowance will also receive a new tax code with reduced allowances. This usually has an N at the end to signify that the allowances have been transferred.

Please note if you are self-employed then the allowance will be given when you send your self-assessment tax return.

Marriage allowance is far less complicated than you may think!


Do you have to apply each tax year?

HMRC will automatically carry over the marriage allowance each year unless you cancel it, maybe because of a change in circumstances – divorce or death. So your tax codes will be adjusted to cater for the allowance each year.

If you do need to cancel the allowance then you would need to do this online on the HMRC website.


What if your income changes?

If you or your partner’s income changes then I would recommend that you contact HMRC via phone. They will let you know if you are still eligible for the allowance or whether it needs to be cancelled.


What have you got to lose, apply now!