Claiming My Wife’s Unused Tax Allowance – UK

In the UK, a spouse or civil partner can claim the unused tax allowance of their partner. If you are married, you can do this on your tax return.

The marriage allowance has been in effect since April 6th, 2015. Some couples need to know about the marriage allowance. With this new tax development, you can now lay a claim back four years ago.

In this article, tax allowances and claiming your wife’s unused personal allowance will be discussed thoroughly.

Let’s start!

The Marriage Allowance

If you and your spouse or civil partner meet certain conditions, you could give up some of your allowances to provide a tax credit. Every spouse and civil partner is eligible to receive the marriage allowance. For couples born before 6 April 1935, however, the married couple’s allowance will usually be more beneficial, so you should claim it instead.

If you are married, a wife, or a civil partner, you may transfer £1,260 from your Allowance to them. Marriage Allowance can be applied for free. They can reduce their tax by up to £252 every tax year (6th of April to 5th of April the following year).

A couple can qualify for benefits if one earns less than the other and has an income of up to £12,570. For you to be eligible, you must have an income of between £12,571 and £50,000 (£43,662 in Scotland). If you were eligible for Marriage Allowance since 5 April 2018, you could backdate your claim.

Do I qualify for the Marriage Tax Allowance?

If you meet the following criteria, you may be eligible for Marriage Tax Allowance:

• Your relationship is marriage or civil partnership.
• The date of your birth or the date of your partner’s birth is after April 5, 1935.
• One of you earns less than the personal allowance, and the other one earns more than such personal allowance and up to the basic tax rate.

Consider These Factors Before Applying:

Firstly, you need your own and your partner’s National Insurance numbers. National Insurance numbers cannot be obtained by immigrants who do not intend to work or study in the UK. Marriage Allowance can be applied for by contacting the Income Tax helpline.

They must also verify your identity. Among the following, you can choose two:

• An individual’s P60
• One of your three most recent pay slips
• Details of your UK passport
• Credit file information (such as loans, credit cards, or mortgages)
• Your most recent Self Assessment tax return (in the last three years)
• License for driving in Northern Ireland

Apply online

Marriage Allowance can be applied online in the shortest amount of time. A confirmation email will be sent to you within 24 hours of submitting your application. To apply, head to this link.

Other ways to apply

Marriage Allowance can be applied for in the following ways if you cannot apply online:

• You can do so if you’re already registered and submit tax returns through self-assessment. Head to this link if you want to apply through self-assessment.
• HMRC can be contacted by writing. You may do it at this link.

Is there a reason I should get a refund?

April 2015 marked the introduction of the marriage allowance. Regardless of whether you transferred the personal allowance at the time, you may be able to do so in 2018/19 and subsequent tax years.

Neither 2015/16, 2016/17, nor 2017/18 tax years are eligible for tax claims. If the recipient of the tax reduction cannot use the allowance AND the person giving it up, you will not receive the full benefit. By doing so, couples can save on taxes.

You can save £252 in taxes by transferring £1,260 from the 2021/22 tax year. Accordingly, £1,250 can be transferred in 2020/21. For the 2019/20 tax year, the personal allowance is $12,500, so £1,250 can be transferred (savings of up to $250). The personal allowance for the 2018/19 tax year was £11,850, meaning £1,190 can be transferred, with a maximum savings of £238.

Claiming of Tax Refund

As part of giving up part of their allowance, the person giving up part of their allowance must make a claim, which may include claims for earlier years.

GOV.UK has an online facility for doing this. A National Insurance number and proof of identity are required. Examples include your P60, payslips, passport, or child benefit. Additionally, you will need your spouse’s or civil partner’s National Insurance number.

For those who cannot claim online, you can contact HMRC at 0300 200 3300 or write to them.

HMRC will refund you for previous years. They will alter the tax codes for you and your spouse or civil partner for the current and future tax years. Moreover, self-employed individuals and those in Self Assessment will file their tax returns along with their marriage allowance.

Warning

Several organisations offer to file your Marriage Allowance claim for you, but they typically charge a fee. You must be on your guard when dealing with some of these organisations because they can behave very unscrupulously. Some commercial organisations may pretend to be HMRC even when they are dealing with one of these commercial organisations.

Time Limits

The deadline for claiming back to 2018/19 is 5 April 2023. You can submit a claim for 2022/23 until 5 April 2027.

Conclusion

That’s it! Many couples can save money on taxes by knowing about the marriage allowance. The personal allowance can be transferred to £1,260 if married or in a civil partnership. As of 2022-23, this amounts to just over 10% of the basic Personal Allowance of £12,570. In other words, this is the amount of income you don’t have to pay taxes on.

Frequently Asked Questions

Should my partner or I apply for Marriage Tax Allowance?

Marriage Tax Allowance can be applied for online by the lower earner. The HMRC will set up your partner’s tax code or self-assessment tax return if your application is successful and you are the applicant.

In most cases, tax code adjustments take two months to complete.

Can Marriage Tax Allowance be backdated?

Although this has never used to be the case since November 2017, it has been possible to backdate Marriage Tax Allowance. If you and your spouse or partner meet the proper criteria, you can claim back all the taxes you would have paid. There is, however, a four-year limit on how far you can go back. To claim back your tax, give the HMRC Income Tax helpline a call.

Can I cancel my Marriage Tax Allowance?

Yes! By contacting HMRC, you can do so.

Am I eligible to claim the Marriage Tax Allowance if I’m unemployed?

A prerequisite for receiving the Marriage Tax Allowance is that one of you has to be tax-exempt. Those who are unemployed can transfer 10% of their allowance to their partner if they are earning a basic rate taxpayer.

It is also possible for self-employed individuals to claim a marriage tax allowance if one partner earns less than £12,500 and the other between £12,501 and £50,000. A marriage tax allowance will reduce your bill if one of you does self-assessed taxes.

What is the difference between the Marriage Tax Allowance and Married Couple’s Allowance?

A tax incentive called the Marriage Allowance allows a lower earner to transfer $1,250 from their personal tax allowance to a civil partner or spouse.

If one or both spouses were born before April 6th, 1935, they are eligible to receive the Married Couple’s Allowance. Each year, it can reduce a household’s tax bill by anywhere from £345 to £891.50, depending on the household’s upper earner (in civil partnerships or traditionally the husband in a marriage).