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Revised HMRC figures reveal more than 2 million people are missing out on this tax break

2-minute read

Sam Bromley

26 June 2019

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HMRC has admitted it overestimated the number of people claiming the Marriage Allowance last year.

In a publication released in June 2018, HMRC said more than 3 million couples were benefitting from the tax break.

But revised figures released this month show that the real number is fewer than 2 million, meaning that many are still missing out.

What is the Marriage Allowance?

The government introduced the Marriage Allowance in April 2015 to ease the burden on families, saying at the time that it’s “families who raise our children, look after our old and keep our country going.”

Using the Marriage Allowance, eligible partners can transfer 10 per cent of their Personal Allowance to their husband, wife or civil partner.

So for the 2019-20 tax year, if your income is between £12,501 and £50,000 (£43,430 in Scotland), and your partner earns less than you (with an income of £12,500 or less), your partner can transfer £1,250 of their Personal Allowance to you (and vice versa). says this can reduce a couple’s tax bill by up to £250 a year – and what’s more, you can backdate a claim and include any tax year since 5 April 2015 that you were eligible for the allowance.

What did HMRC get wrong?

HMRC fluffed their numbers last year by including backdated claims for the Marriage Allowance as well as claims for that tax year, meaning they counted some claimants multiple times.

HMRC’s updated figure puts the estimated number of claimants at 1.78 million, a dramatic drop from the 3 million figure they celebrated last year.

HMRC estimates the total number of eligible claimants at around 4 million, which means that fewer than half who can claim have done so.

Steve Webb, former Pensions Minister and current Director of Policy at Royal London, told the Financial Times: “HMRC urgently needs to do more to alert families who could benefit so that everyone who is entitled to help receives it.”

But HMRC denies anyone is missing out, saying that eligible couples can still backdate their claims for each year including 2015-16 – as long as they do it by 5 April 2020.

What should you do if you’re eligible? says the partner with the lowest income should make the claim. This partner can apply online and won’t need to do it every year – the tax break will be applied automatically if the application is successful.

The partner receiving the extra allowance will get it through an update to their tax code or as a change to their Self Assessment tax bill, and HMRC will pay out backdated claims by cheque.

Did you know about the Marriage Allowance? What do you think about HMRC’s latest mistake? Let us know in the comments below.

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