Articles

Thursday 28th March 2019

Can I save tax if I am married?

What is the Marriage Allowance and who can get it?

You can receive or transfer 10'% of your tax free allowance to or from your spouse or civil partner each tax year to save tax.

To benefit as a couple, you must be married or in a civil partnership, living together doesn't count.  One of you needs to be a basic rate 20% tax payer.  Higher 40% and additional rate 45% tax payers are not eligible for this allowance.

You can backdate your claim 4 years to include any tax year since 6 April 2015 that you were eligible for Marriage Allowance.

Example based on the tax year ending 5th April 2018

David has been working as a dental nurse earning £18,000 and studying to become a dentist.  David pays income tax at the basic rate tax band of 20% on his earnings above £11,500.  His wife Daisy doesn't work and looks after their three-year old son Duncan. 

As David is a basic rate tax payer, Daisy elects to transfer 10% of her £11,500 tax free allowance to David.   Daisy's allowance is now reduced from £11,500 to £10,350.   As a result, Daisy still pays no tax and David pays £230 (£1,150 @ 20%) less tax.

As Daisy hasn't worked since 2015 and David has worked and payed tax in the since 2015 the allowance transfer can be backdated to 2015.  This results in a further £432 tax saving to David.

You can make a claim online at https://www.gov.uk/apply-marriage-allowance 

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