Eligible couples across the UK are being encouraged to check if they can claim the Marriage Allowance, a government tax relief that could be worth up to £1,200. The scheme, highlighted recently by financial advice platform MoneySavingExpert, allows a spouse or civil partner to transfer a portion of their unused personal tax allowance to their higher-earning partner, potentially reducing their overall tax bill.
The Marriage Allowance permits a non-taxpaying partner to transfer 10% of their personal allowance – currently £1,260 – to their spouse or civil partner, provided the recipient is a basic-rate taxpayer. For the current tax year, this transfer can reduce the higher earner's tax by up to £252. Crucially, claims can be backdated for up to four previous tax years, meaning a total potential saving of £1,200 for those who have been eligible since the allowance was introduced in April 2015.
HM Revenue and Customs (HMRC) estimates that over 2.1 million eligible couples are not currently utilising the Marriage Allowance. The criteria for eligibility are specific: one partner must earn below the personal allowance threshold (meaning they pay no income tax, or earn less than £12,570), while the other partner must be a basic-rate taxpayer (earning between £12,571 and £50,270). If either partner is a higher or additional rate taxpayer, the allowance cannot be claimed.
The process for claiming is straightforward and can be completed online via the government's website. Once approved, the tax code of the basic-rate taxpayer will be adjusted to reflect the allowance, leading to a reduced tax deduction from their wages or pension. For backdated claims, a lump sum payment or a reduction in future tax bills will be issued.
The Marriage Allowance was introduced by the Conservative-Liberal Democrat coalition government in 2015 as part of wider efforts to support families and recognise marriage in the tax system. While it has been available for several years, awareness remains a challenge, with many couples unaware of their potential entitlement. Financial experts routinely advise individuals to review their tax affairs to ensure they are not missing out on available reliefs.
Opposition parties have periodically called for reforms to the tax system to better support families, with some advocating for a more comprehensive approach to family taxation. However, the Marriage Allowance remains a specific, targeted relief aimed at couples where one partner has unused personal allowance.
Source: Bournemouth Echo, MoneySavingExpert