If you or your partner has an income of less than £12,500, you may be able to benefit from the marriage allowance.
This is a Government scheme that allows you to transfer some of your personal tax allowance to your husband, wife or civil partner.
You can transfer up to 10% of your tax-free allowance if they earn more than you do. This could reduce their tax bill by up to £250 a year.
You can also backdate any claim to include tax years from 5 April 2016 onwards. Even if your husband, wife or civil partner has died since that date, you may still be able to claim - call the Income Tax helpline to find out more.
Who can apply for the marriage allowance?
You're only eligible for this allowance if all of the following apply:
- you’re married or in a civil partnership
- one of you doesn’t pay income tax
- the other person in the relationship pays income tax at the basic 20% rate
This usually means one of you has an income of less than the personal tax allowance (£12,500 for most people in the 2020/21 tax year) and the other has an income between £12,501 and £50,000 (£12,501 and £43,340 for Scottish tax payers).
Your income includes your earnings and other income such as:
- employment benefits, such as a company car
- pension income
- any savings interest or dividends
If any of these apply, you should have received a tax code letter about it.
Find out more about what your tax code means on the GOV.UK website.
How the marriage allowance works
Here's an example of how the marriage allowance can help.
Tom works part-time as a caretaker at a local school and earns £10,000 a year. This is below the standard personal allowance of £12,500, so he doesn't pay any income tax.
His wife Susie has a full-time job as a graphic designer on an annual salary of £25,000. That's more than the £12,500 personal allowance, but lower than the £50,000 threshold for the 40% higher rate. So she pays income tax at the basic rate of 20%.
Tom can transfer 10% of his ‘unused’ tax-free allowance (£1,250) to Susie, so her personal allowance goes up to £13,750. As a result, an extra £1,250 of what she earns is now tax-free, which means she pays £250 less in tax.
Things to remember
This allowance is only for those who are married or in a civil partnership - living together as a couple doesn't count.
The marriage tax allowance is for couples who were both born on or after 5 April 1935.
If either (or both) of you were born before that date, you may be able to claim the married couple’s allowance instead. You can't claim both the marriage allowance and the married couple’s allowance at the same time.