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Married couples: Don’t miss out on £250 tax back

Paloma Kubiak
Written By:
Paloma Kubiak

Married couples and those in a civil partnership may be eligible for a tax break worth up to £252 this year.

The Marriage Allowance enables married couples and people in civil partnerships to transfer part of their Personal Allowance leading to the higher earning partner reducing their tax bill.

More than two million couples are in receipt of this tax break, but thousands more may be eligible.

The Personal Allowance – currently £12,570 – is the amount of income you don’t pay tax on and 10% can be transferred to a husband, wife, or civil partner as long as the applicant is a non-taxpayer and the recipient is a basic rate taxpayer.

As such, the 10% (rounded up to £1,260) can be transferred meaning couples save the basic rate of tax (20%) on this amount – £252. However, when the non-taxpayer transfers some of their allowance, they may pay more tax, but could still pay less as a couple.

Both partners will receive new tax codes reflecting the transferred allowance.

Couples can apply at any time and claims can also be backdated up to four previous tax years, meaning eligible partners can receive a payment of up to £1,242, according to HMRC. This is made up of transferring 10% of the Personal Allowance for the tax year in question:

  • £252 in the 2022/23 tax year
  • £252 in the 2021/22 tax year
  • £250 in the 2020/21 tax year
  • £250 in the 2019/20 tax year
  • £238 in the 2018/19 tax year.

Where a claim is backdated, HMRC sends a cheque with the amount.

HMRC reminded eligible couples that it’s free to apply via the HMRC’ Marriage Allowance website.

Even if you don’t currently qualify, a change in circumstances down the line could mean you’re eligible:

  • One partner retiring and the other remaining in work
  • A change in employment
  • A reduction in working hours which means earnings fall below their Personal Allowance
  • Maternity, paternity, or shared parental leave
  • Unpaid leave or a career break
  • One partner studying or in education and not earning above their Personal Allowance.

However, if you are a cohabiting couple and are living together but not married or in a civil partnership, you won’t be eligible. If a spouse or civil partner has died since 5 April 2018, the surviving person can still claim by contacting the Income Tax helpline.

Marriage Allowance claims are automatically renewed every year. However, couples should notify HMRC if circumstances change.

Angela MacDonald, HMRC’s deputy chief executive and second permanent secretary, said: “We want to ensure people are receiving vital financial support at a time when they need it most. Married couples or those in a civil partnership could potentially receive tax relief worth up to £1,242, meaning extra cash in their pockets.”