The Marriage Allowance tax break explained

You could pay £250 less tax this year – and possibly backdate it for another four years.

The Marriage Allowance is a way to shift some of your tax-free allowance to your husband or wife if they are a low earner.

If you’ve been eligible for the current and past four years you could claim back tax worth £1,188.

There are various conditions so it won’t be for everyone (including me), but it’s certainly worth taking a look at the criteria to see if you can claim.

Here’s how it works and what you need to know.

Who is eligible for the Marriage Allowance?

You need to be either married or in a civil partnership. 

The higher earner in the couple must earn less than £50,270 but more than £12,570 in the tax year you’re applying for. So right now that’s 6th April 2021 to 5th April 2022.

In Scotland it’s a little different and income below £43,662 for the higher earner.

The lower earner in the couple must earn less than £12,570 in the same year. This is the basic rate threshold where you start paying income tax, though if you have a lower limit (for example because you underpaid tax a previous year) then that amount will apply.

You’re able to make a claim if you get a pension, as my parents did. Though if you or your partner were born before 6th April 1935 (so that’s anyone currently 85 years old and above), then you can get choose instead to get the Married Couples Allowance.

How much money can you get?

The scheme allows the lower earner to transfer 10% of their tax-free allowance to the higher earner. So for this tax year, with the threshold at £12,570, you can move £1,257 of the allowance over. 

So let’s say the lower earner’s total income for the year is £10,000. By transferring 10% of their personal allowance to their spouse, their personal allowance drops to £11,313. But since they earn less than this, it doesn’t change the fact that they don’t pay any tax that year,

However the higher earner now has an increased personal allowance of £13,827 before any tax is due. Since the basic rate of tax is 20% this will work out as paying £251.40 less tax in the year (20% of £1,257).

Of course if one of you earns, between £11,313 and £12,570 you won’t get the full benefit. That’s because the lower earner will now have to pay 20% anything above £11,313.

You won’t be paid back any saved cash. Instead the tax code of the higher earner will change and they’ll just pay less tax throughout the year or on their own tax return if they’re self-employed.

Claiming Marriage Allowance for previous years

You can backdate your claim by four years alongside the current year. The amount per year changes though since the tax thresholds have changed over that time. Even so, your claim is potentially worth up to £1,220 over the five years.

Any money from previous years will be sent to you via cheque so you’ll see the savings (almost) straight away.

You can also claim for a deceased partner if they’ve they were alive and you were both eligible during one or more of those tax years.

Here’s how to see if you were eligible and how much you could potentially claim for these previous years.

2021/22 Marriage Tax Allowance totals

The basic rate upper threshold was £50,000 in 2019/20 (£43,430 in Scotland), while the personal allowance was £12,500.

So the amount you could claim in England, Wales and Northern Ireland would be £252.

2020/21 Marriage Tax Allowance totals

The basic rate upper threshold was £50,000 in 2019/20 (£43,430 in Scotland), while the personal allowance was £12,500.

So the amount you could claim in England, Wales and Northern Ireland would be £250.

2019/20 Marriage Tax Allowance totals

The basic rate upper threshold was £50,000 in 2019/20 (£43,430 in Scotland), while the personal allowance was £12,500.

So the amount you could claim in England, Wales and Northern Ireland would be £250.

2018/19 Marriage Tax Allowance totals

The basic rate upper threshold was £46,350 in 2018/19 (£43,430 in Scotland), while the personal allowance was £11,850.

So the amount you could claim in England, Wales and Northern Ireland would be £238.

2017/18 Marriage Tax Allowance totals

The basic rate upper threshold was £45,000 in 2017/18 (£43,000 in Scotland), while the personal allowance was £11,500. 

So the amount you could claim in England, Wales and Northern Ireland would be £230.

How to claim the Marriage Tax Allowance

It’s really simple. You head to the HMRC website or phone them on 0300 200 3300.

The lowest earner needs to be the one who applies, as it’s their allowance which will transfer over.

You’ll need both your National Insurance numbers, as well as one of the following ways to prove your identity:

• the last 4 digits of the account that your child benefit, tax credits or pension is paid into
• the last 4 digits of an account that pays you interest
• details from your P60
• details from any of your 3 most recent payslips
• your passport number and expiry date

Once you’d made the initial claim, it’ll keep going each new financial year.

What if your situation changes?

If you or your partner’s income changes during the current year you are claiming for and you’re no longer eligible then you need to let HMRC know. You’ll still get the tax break for the rest of the year.

You also need to do this if your relationship ends through a divorce, dissolution or if you become legally separated. The claim could be backdated in this scenario which means you could owe tax.