Claiming the transferable marriage allowance


July 10, 2018|In KRW Tax Tips|By Keith Witchell

The transferrable marriage allowance arrived in 2015 but was widely considered to be a bit of a damp squib as very few couples could claim it and a separate claim needed to be made.

So, what’s it all about? If you are married or in a civil partnership and one of you doesn’t fully utilise their personal allowance, while the other is a basic rate taxpayer, then the lower earning spouse/partner can transfer (up to) 10% of their personal allowance. This generates a tax saving of (up to) £238 for the higher earning spouse/partner based on the current £11,850 personal allowance.

To claim the relief you must be married or in a civil partnership, and have taxable earnings below the personal allowance level (£11,850 for 2018/19), while your spouse/partner must earn between £11,850 and £46,350 (£43,430 if you’re in Scotland).

In practice, among our client base we haven’t been able to identify many clients who are eligible to claim the relief, but where one spouse is not working for a period of time then a claim would be well worth making.

To claim the relief involves making an election to HM Revenue & Customs, but this can be backdated to include any tax year from 2015/16 onwards currently (any claim must be made within four years of the end of the tax year to which it relates).

Changes were recently made to open up claims to the personal representatives of a deceased taxpayer for any tax year up to and including the year in which they died, providing they were still married or in a civil partnership at the date of their death.

Key Facts

  • Transferable marriage allowance allows 10% of your personal allowance to be transferred
  • Can claim where one spouse earns <£11,850 and the other earns £11,850 to £46,350
  • Generates tax saving of (up to) £238 for the higher earnings spouse in the current tax year
  • Also applies to civil partnerships
  • Claims can be made retrospectively from 2015/16 onwards

For further advice on this matter, please contact me.

Keith Witchell

Director