For all my brothers and sisters living and working in the UK
This inshaAllah can benefit many, especially for families where the bread winner is the spouse with an income of less than £43K
Doesn't take long to sign up to it and you might as well do it as its just our earnings coming back to us, similar to child benefit money or Tax refund.
You will need yours and your partners NI number, Partners Passport details and DOB.
Obviously the one who earns the least amount or the one who doesn't earn a salary must apply. Either one of you can fillout the application as long as you have permission from your partner :) and all the details.
1. How it works
Marriage Allowance lets you transfer £1,100 of your Personal Allowance to your husband, wife or civil partner - if they earn more than you.
This reduces their tax by up to £220 in the tax year (6 April to 5 April the next year).
To benefit as a couple, you (as the lower earner) must have an income of £11,000 or less. You can calculate how much tax you’ll pay as a couple.
If you were eligible for Marriage Allowance in the 2015 to 2016 tax year, you can backdate your claim to 6 April 2015. You can only transfer the set amount each year.
Who can apply
You can get Marriage Allowance if all the following apply:
you’re married or in a civil partnership
you don’t earn anything or your income is under £11,000
your partner’s income is between £11,001 and £43,000
You can still apply for Marriage Allowance if you or your partner:
are currently receiving a pension
live abroad - as long as you get a Personal Allowance.
If you or your partner were born before 6 April 1935, you might benefit more as a couple by applying for Married Couple’s Allowance instead.
2. How to apply
You can apply for Marriage Allowance online.
If your application is successful, changes to your Personal Allowances will be backdated to the start of the tax year (6 April).
How your Personal Allowances change
HM Revenue and Customs (HMRC) will give your partner their extra allowance either:
by changing their tax code, usually to 1166M - this can take up to 2 months
when they send their Self Assessment tax return, if they’re self-employed
Your tax code will also change if you’re employed or get a pension. Your new code will reflect your new Personal Allowance and will end with ‘N’.
When Marriage Allowance stops
Your Personal Allowance will transfer automatically to your partner every year until one of you cancels Marriage Allowance or your circumstances change, eg because of divorce or death.
3. If your circumstances change
You or your partner can cancel Marriage Allowance online. You’ll be asked to prove your identity using information HM Revenue and Customs (HMRC) holds about you.
The date the allowance ends depends on who cancels it.
If you stop transferring the allowance to your partner, it will run until the end of the tax year (5 April).
If your partner asks to stop receiving your allowance, HMRC will backdate the change to the start of the tax year you first started transferring it.
If you get divorced or dissolve your civil partnership
You can cancel the allowance online. You’ll be asked to prove your identity using information HMRC holds about you.
If you’re currently transferring your allowance to your partner you can choose to:
keep transferring it until the end of the tax year (5 April)
backdate the change to the start of the tax year (6 April)
If you ask to stop receiving your partner’s allowance, it’ll run until the end of the tax year.
If your income changes
Contact HMRC if your income changes. They’ll tell you if:
claiming Marriage Allowance will still benefit you as a couple
you need to cancel your Marriage Allowance
If your partner dies
If your partner dies after you’ve transferred some of your Personal Allowance to them:
their estate will be treated as having the increased Personal Allowance
your Personal Allowance will go back to the normal amount
Your income is £8,000 and you transferred £1,100 of your allowance to your partner. This made your allowance £9,900 and their allowance £12,100.
After their death, their estate’s Personal Allowance stays at £12,100 and yours goes back to £11,000.
If your partner transferred some of their Personal Allowance to you before they died:
your Personal Allowance will remain at the higher level until the end of the tax year (5 April)
their estate will be treated as having the smaller amount
Your partner transferred £1,100 to your Personal Allowance, making their allowance £9,900 and yours £12,100.
After their death, your Personal Allowance stays at £12,100 until 5 April, and then goes back to the normal amount. Their estate is treated as having a Personal Allowance of £9,900.