Tax Allowance if you are Married or in a Civil Partnership

SavingsIf you are married or in a civil partnership, and both of you were born after 6 April 1935, you may be eligible for a tax allowance worth up to £432.

The Marriage Allowance is a tax break for couples, where one person is a non-taxpayer (income below the Personal Allowance of £11,000 for the 2016/17 tax year) and the other is a basic rate taxpayer (income between £11,000 and £43,000).

The non-taxpayer can transfer £1,100 (10%) of their unused Personal Allowance to the basic rate taxpayer, meaning they can save £220 on their tax bill. The Marriage Allowance was introduced in April 2015 and last year’s allowance can be back-dated – the income tax bands were slightly different so the saving for last year was £212. This is a total potential saving of £432.

It only takes a few minutes to register for the Allowance at https://www.gov.uk/apply-marriage-allowance. If you need more details, please contact us or have a look at Martin Lewis’s website, which has a really clear explanation: http://www.moneysavingexpert.com/family/marriage-tax-allowance.

The Allowance unfortunately doesn’t apply to higher rate or additional taxpayers. There is a separate tax allowance for couples where one or both were born before 6 April 1935.

The tax break was included in the March 2014 Budget, but was completely over-shadowed by the introduction of the new pension freedoms. An estimated 4 million couples are eligible for the Allowance, but only a small proportion have registered so please pass on this information to friends, colleagues and family.

We are always available to discuss any queries or concerns, so just call or drop us an e-mail.

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