Transferrable Personal Allowance
23rd March 2015As long as we both shall live: I promise to share my personal allowance with you..
From April 2015, Finance Act 2014 allows spouses and civil partners who cannot claim the married couples allowance (therefore those born on or after 6 April 1935) to transfer a fixed amount of their personal allowance to each other to save tax.
The spouse/partner who has the highest income can then have the benefit of more tax allowances. This can provide tax relief where one spouse/partner does not have enough income to use their allowance in full, meaning it would otherwise be lost.
The amount is fixed at 10% of the personal allowance, which for 2015/16 means £1,060 can be transferred. This represents a saving of up to £212 per year for basic rate taxpayers, which will affect a government-estimated 4.2 million couples.
Couples can register their interest to receive the allowance at https://www.gov.uk/marriage-allowance.
HMRC will contact those who have registered in April to invite them to apply.
Blog entry by: Jodie Tarbin.
Disclaimer - All information in this post was correct at time of writing.
