The Marriage Allowance, introduced in April 2015, lets eligible individuals transfer 10% of their personal allowance to their spouse or civil partner.
By doing so, the tax bill of the spouse receiving the additional 10% (currently £1,060) will be reduced by up to £212 in 2015/16. Such a transfer is allowed and worthwhile in cases where:
- one of the spouses has little income and is therefore not using the personal allowance
- the other spouse does not pay tax at the higher or additional rate.
Marriage Allowance can be applied for online. If you are an employer, signpost your employees to gov.uk/marriage-allowance-guide where they will find full information on eligibility, details of how to apply and a link to the online application.
As we are at the end of the tax year, couples may have a better idea as to whether they qualify. When a successful application is made, changes to the personal allowances are backdated to 6 April 2015. In future years the personal allowance will transfer automatically to the spouse until either of the couple cancels the Marriage Allowance or there is a change in circumstances.