With increased living costs in recent years, many people have looked for ways to save money, often by spending less. But making full use of tax allowances could also leave you hundreds of pounds better off each year.
If you qualify and you’re not already claiming it, you should find out about marriage allowance. It’s claimed by an estimated 2.3 million people in the UK, saving them £252 a year in income tax.
However, a huge number of eligible people are missing out. If you’re one of them, the good news is you can backdate your claims.
What is marriage allowance?
Marriage allowance allows you to transfer £1,260 (10 per cent) of your personal allowance to your husband, wife, or civil partner. This can reduce their income tax bill by £252 each tax year (6 April until 5 April).
Alternatively, they can transfer £1,260 of their personal allowance to you, their husband, wife, or civil partner, to reduce your annual tax bill by £252.
Here’s an overview of what marriage allowance is and how it works:
● the spouse or partner who earns less transfers 10 per cent of their personal allowance to their spouse or civil partner, to reduce their tax bill, thereby saving money
● for marriage allowance to be worthwhile, the lower-earner’s total income must be below the personal allowance threshold (£12,570 for 2025/26)
● the higher-earning spouse or civil partner must have an income of between £12,571 and £50,270 (between £12,571 and £43,662 in Scotland)
When you transfer some of your personal allowance, your tax bill might increase slightly, but you pay less as a couple.
The government website has a marriage allowance calculator that you can use to work out how much you could save as a couple. If you or your spouse/partner receive dividends, savings or employment benefits, you can call the income tax helpline to find out how much you could save.
Who can’t claim marriage tax allowance?
There are some scenarios where you can’t claim marriage allowance. For example, if you and your partner aren’t married or in a civil partnership (even if you live together and have children).
Others include:
● anyone older than 90 years old – instead they can claim married couple’s allowance (which can reduce tax by £436-£1,127 a year)
● spouses/partners when both earn more than the personal allowance
● higher or additional rate income taxpayers (marriage allowance can only be claimed if the higher-earning partner is a basic 20 per cent rate taxpayer)
● higher-earning partner/spouses in Scotland who earn more than £43,662
You can still claim marriage allowance if you or your partner receive a pension. And living overseas doesn’t mean you can’t claim, as long as you qualify for the personal allowance.
Example of marriage allowance tax saving
The government website gives the following marriage allowance example:
Your income is £11,500, so you don’t pay tax. Your partner’s income is £20,000 and their personal allowance is £12,570, so they pay tax on £7,430 (their taxable income). As a couple, you pay income tax on £7,430.
When you claim marriage allowance, you transfer £1,260 of your personal allowance to your partner. Your personal allowance becomes £11,310 and your partner gets a tax credit on £1,260 of their taxable income.
You’ll now pay tax on £190, but your partner will only pay tax on £6,170. As a couple you benefit, because you’re only paying income tax on £6,360 rather than £7,430, saving you £214.
Backdating HMRC marriage allowance claims
You can backdate your marriage allowance claim to include any tax year since 5 April 2021 that you or your partner were eligible. Your tax bill or your spouse/partner’s tax bill will be reduced if your claim is approved.
If your partner has died since 5 April 2021, you can still claim marriage allowance for when they were alive. Phone HMRC’s income tax helpline for help. If they were the lower earner, (if not you) the person responsible for managing their tax affairs must call HMRC.
How to apply for marriage allowance
You can apply online for marriage allowance through the government website. It’s free to apply, you just need both National Insurance numbers. If incomes come only from wages, the person who earns less should claim.
If either of you also gets dividends or savings, call the income tax helpline for advice on who should claim.
You can also apply via Self Assessment, if you’re registered and send tax returns. Or you can fill in the MATCF Marriage Allowance form and send it back by post.
If successful, changes will be backdated to the start of the tax year. HMRC will give you the allowance your partner transferred either by changing your tax code or when you file your Self Assessment tax return. The same applies if you’re transferring some of your personal allowance to your partner.
Renewing and cancelling Marriage Allowance
Claims for marriage allowance are renewed automatically each year, so, you’ll need to cancel if you legally separate, get divorced, or end your civil partnership.
If the relationship ends, either spouse or civil partner can cancel the marriage allowance claim. For other reasons, the person who made the claim must cancel.
You can cancel marriage allowance online or phone the marriage allowance enquiries line on 0300 200 3300 (Monday to Friday, 8am to 6pm).
If caused by an income increase, marriage allowance will remain until the end of the tax year (5 April). If the relationship has ended, the change may be backdated to the start of the tax year (6 April), which will mean there’s additional tax to pay.
You’ll need to cancel marriage allowance if the lower earner’s income increases above £12,570 (the personal allowance threshold) or the higher earner’s income goes above £50,270 (£43,662 in Scotland).
About GoSimpleTax
GoSimpleTax is a solution for landlords, the self-employed, sole traders, freelancers, and anyone with income outside of PAYE.
You can use the software to record income, expenses, and tax submissions all in one. It will also provide you with hints and tips that could save you money on allowances and expenses you may have missed.
Useful tax guides for businesses
- Business tax – a guide for small businesses
- Making Tax Digital for business income tax
- HMRC penalties for late tax returns and late payment
- Registering for Self Assessment – a guide for the self-employed
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