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It is estimated more than two million people across the UK could be missing out on £1,220 in Marriage Tax Allowance. HMRC are currently reminding people who are married or in a civil partnership to use the allowance before it’s too late. The good news will be a welcome relief to many couples who are feeling the squeeze at the moment.

It’s fairly straightforward to apply for and make full use of the tax break. Here we help you do that.

Marriage Tax Allowance – What Is It?

Earlier this year the UK Chancellor, Rishi Sunak, confirmed that the personal allowance for 2021/2022 Tax Year would be £12,570.  The marriage tax allowance allows a person to transfer £1,260 of their personal allowance to their spouse or civil partner, if they earn more than you. If it is successful, it will reduce the higher earner’s tax bill.

What is the Criteria?

There are specific criteria applicants need to adhere to: –

  • One person needs to be a non-taxpayer earning less than the £12,570 personal allowance
  • You both need to be married or in a civil partnership
  • You must both be born after 6th April 1935
  • The other person will need to be on the basic 20% tax rate. This means you will need to be earning less than £50,270 (or £43,662 if you live in Scotland)

How Much Money Can You Claim For?

For the Tax year 2021/2022 marriage tax allowance is worth up to £252. If your claim is successful you will automatically benefit from the tax break going forward, without the need to reapply. As an added benefit you can backdate your claim for up to four tax years. These are the following amounts you can claim for: –

  • 2021/2022 – £252
  • 2020/2021 – £250
  • 2019/2020 – £250
  • 2018/2019 – £238
  • 2017/2018 – £230

This therefore means if you claim for this tax year, and backdate for the maximum four years, you’ll receive £1,200. If you want to claim for the 2017/2018 tax year, you will need to do this before 5th April 2022.

How Do I Apply?

The non-taxpayer will need to make the application. The application process is onlt takes a few minutes. Have your national insurance and required ID at the ready. For more information and details on how to apply visit the Government website.

If you would like advice on your tax affairs please contact us. Call us on 0800 471 4546 or you can contact us here.