Issue briefing: marriage allowance
Published 20 February 2015
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Married couples and civil partners could benefit from an annual tax reduction of up to £212, through a new marriage allowance which starts in the 2015 to 2016 tax year. Eligible couples are now able to register their interest at GOV.UK and will be invited to formally apply online after 6 April. This briefing explains who could benefit from the allowance and how they can get it.
1. What is the marriage allowance?
The marriage allowance will allow a spouse or civil partner with income less than £10,600 to transfer £1,060 of their personal tax-free allowance to their higher-income spouse or partner. As long as the person receiving the transfer doesn’t pay tax at the higher or additional rate (for most people that’s an income of £42,385 or below), couples could see an annual tax reduction of up to £212, or around £17.66 a month.
The allowance was announced in 2013 and full details were published as part of the Budget 2014.
2. Who is eligible?
About 4 million married couples and civil partners born after 6 April 1935 are eligible for the marriage allowance. Couples born before 1935 benefit from the separate Married Couples Allowance.
3. Registering interest in the allowance
Eligible couples can now register their interest for marriage allowance at gov.uk/marriageallowance.
Registration is straightforward: the spouse or partner with the lower income registers their interest in transferring their personal allowance by entering some basic details (name and email address) on the GOV.UK website. HM Revenue and Customs (HMRC) will then confirm the expression of interest by email and explain when couples will receive an invitation to apply.
There is no disadvantage for those who don’t register; they will be able to make an application during the tax year 2015 to 2016 and still receive the full allowance.
The registration process is being run because research shows that some customers like to know about changes to their personal finances early. It will also help HMRC to manage the introduction of what is a big change to personal tax allowances. From April, we will invite registered customers to apply formally for the allowance in stages. This means we can better manage the expected demand as people apply for the new allowance.
Registering for marriage allowance can only be completed online, is straightforward and only takes about 3 minutes. It is not possible to register for marriage allowance by calling HMRC.
4. Applying
From April 2015, HMRC will invite people who have registered with us to apply for the allowance and we will tell them about the change to their Pay As You Earn (PAYE) tax code or reflect the changes in their Self Assessment calculations. Applications will be made through GOV.UK. HMRC will provide support to customers who need it.
Couples who choose not to register will be able to apply directly for the allowance later in 2015.
5. To find out more
For more information, and to register interest, visit gov.uk/marriageallowance.