Whenever I meet with a new client, one of the first things I check for them is that the correct level of income tax is being deducted from their monthly income. More often than not, I find that married couples are not claiming the marriage allowance.
The marriage allowance is a little-known tax allowance introduced in 2015, which allows anyone earning below the £11,000 threshold for basic rate income tax to transfer some of their tax-free personal income allowance to their spouse.
Despite a number of advertising campaigns to promote the incentive by HMRC, incredibly, of the 4.2 million couples in the UK who could benefit from this tax saving, only 1 million couples have actually applied.
Naturally, there are certain criteria you need to meet to qualify for the allowance, but so long as your partner earns a salary within the 20% basic rate income tax band (ie currently earning between £11,000 and £43,000), you could reduce your tax by £220 in 2017, and better still, you may be able to back-date a claim for the previous tax year meaning you could be entitled to a refund of up to £432.
So, what do you have to do to claim your refund?
If you’re married or in a civil partnership (cohabiting doesn’t count unfortunately!) visit www.gov.uk/marriage-allowance and simply follow the instructions to find out how you could benefit from the marriage allowance.
