HMRC has reminded married couples and those civil partnerships that they could reduce their income tax liability by up to £252 a year by sharing their personal allowances.

Figures from HMRC show around 1.8 million married couples and those in civil partnerships are making use of the benefit but many more could be eligible.

Recent changes in circumstances may mean that they are now eligible to make a claim or their eligibility has changed.

Marriage Allowance allows married couples or those in civil partnerships to share their personal tax allowances if one partner earns an income under their Personal Allowance threshold of £12,570 and the other is a basic taxpayer.

The personal allowance is the amount of income you don’t have to pay tax on so by transferring some of your allowances to your partner, they are able to earn more income tax-free.

They can transfer 10% of their tax-free allowance to their partner, which is £1,260 in the 2021 to 2022 tax year. It means couples can reduce the tax they pay by up to £252 a year. Couples can backdate their claims for any of the four previous tax years, which could be worth up to a total of £1,220.

If you’ve recently taken unpaid leave, changed employment due to Covid-19, or reduced your hours, you could now be eligible to claim the allowance.

You may also be entitled to it if you or your partner recently retired.

It is free to apply for the marriage allowance and you can check the eligibility on the HMRC website.

Married couples may have experienced a change in their circumstances which could now mean they are eligible for Marriage Allowance, including:

  • A recent marriage or civil partnership
  • One partner has retired and the other remains working
  • A change in employment due to Covid-19
  • A reduction in working hours which means their earnings fall below their Personal Allowance
  • Unpaid leave or a career break, or
  • One partner is studying or in education and not earning above their Personal Allowance

If a spouse or civil partnership has died since April 5th, 2017, the surviving person can claim by contacting the Income Tax helpline.

Marriage Allowance claims are automatically renewed every year. However, couples should notify HMRC if their circumstances change.

Rachael Olukoju
Rachael Olukoju

Rachael is a diligent qualified accountant with audit experience and joined us from a top 15 accountancy firm. With a thirst for knowledge and personal development, Rachael continues to study towards further qualifications. She is a strong communicator who is passionate, goal-driven and leads by example. Rachael has significant experience in management and statutory accounts preparation and review alongside a strong understanding of reporting and completion against strict deadlines.