Low take-up of the marriage allowance

The marriage allowance came into force on 6 April 2015 and allows lower earning couples to share part of their personal tax-free allowance. Recently published figures have suggested that less than a quarter of the 4.2m couples eligible to make a claim have done so.

HMRC has commented that they '…are stepping up our marketing campaign to ensure couples do not to miss out on this marriage tax break. Couples have up to four years to claim backdated annual allowances and we have simplified the application process so that families do not miss out.'

The marriage allowance is available to married couples and those in a civil partnership where a spouse or civil partner doesn’t pay tax or doesn’t pay tax above the basic rate threshold for income tax (i.e. one of the couple earns less than £11,000 in 2016-17). There is a different marriage allowance for those born before 6 April 1935.

The allowance allows the lower earning partner to transfer up to £1,100 (2015-16: £1,060) of their personal tax-free allowance to a spouse or civil partner. The marriage allowance can only be used when the recipient of the transfer doesn’t pay more than the basic 20% rate of income tax. This could result in a saving of up to £220 for the recipient (20% of £1,100) or around £18.33 a month.

Couples that have not yet claimed the allowance can backdate their claim to 6 April 2015 and claim back up to a further £212. An application for the marriage allowance can be made online or by telephone. The application must be made by the non-taxpayer who is transferring their allowance. To benefit as a couple, the non-taxpayer needs to earn less than their partner and have an income of £11,000 or less.

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