To tell you all about marriage allowance?

[Floopily]

Posting here for maximum visibility, obvs I'm not BU at all! I found out about this from one of those pop up ads on FB and was all 'Oh yeah another PPI type nonsense' but when I looked into it on the gov.uk website it is totally legit. We had a couple of years where DH was earning very little, so he went online and applied to transfer the maximum unused allowance to me and I got a cheque for £440 from HMRC a couple of weeks later. He said it was really easy to do as well. Well worth it for anyone married where one party is SAH or earns under the threshold.

www.gov.uk/marriage-allowance

Trying very hard to do a clicky link and failing miserably...

www.gov.uk/marriage-allowance

Earning person has to earn under £50k

I got very excited for a few minutes!
Thanks for the tip though.

Oops sorry, I did debate cutting and pasting all the bits from the website but decided against it!! There are various rules around it, we couldn't claim for one year because I'd self assessed that year even though I don't think I was over the limit.

It was thanks to a FB post that I found out that DH was entitled to tax back through the marriage allowance. Very handy. I share the post each time it pops up on 'Memories' or time hop etc.
It's amazing how many people don't realise they can claim it

I heard it on breakfast tv about 4 years ago. The piece was quite patronising..along the lines of low income = dimwit who'll struggle to fill in the forms.

Sorry this is probably irrelevant to your thread, but I applied for Marriage Allowance a few months ago as I am the low earner, my husband earns a little less than 20k a year. However since his tax code has changed, he has been getting taxed a lot of money! One month they took off £300 tax and he came out with nearly less than £1000 that month. I thought MA is supposed to be saving tax/money? I am still confused by how it works. Can anyone help me with this?

Phone HMRC and explain that your unused allowance should be transferred to your DH and his code should reflect the exact amount. They've messed up something, they do that quite often.

Can’t transfer my unused tax allowance to DH because he’s a higher rate taxpayer unfortunately/fortunately. Have to pay back child allowance too.

@KnittingForMittens What was his tax code before and what is it now? Does he have a company car/ van or other taxable benefit?

Applying for this was the worst thing we ever did and took months to sort out. Wish we had never bothered!

Allyg1185 why is that?

Thanks for the link.

Does anyone know if this is a one payment or is it payable every year?

We do that. It saves a few pounds a year. You can transfer 10% of one partners personal allowance to the other. Obviously if you both pay tax it does nothing, as one partner pays more tax, and the other pays the same amount less.

Interestingly my accountant thought we couldn't do it, as his expensive tax calc software wouldn't let him do it. Once you make the claim it carries on until you stop it.

www.gov.uk/marriage-allowance

You can do it every year @callmerachel once you do it, it changes both of your tax codes and stays like that until you ask them to change it back.

We also applied as DH is low income due to being a mostly a SAHD. It was great but since then they've written to him in April sending him 3/4 letters saying he owes x amount, all different figures and we also had to pay some back. As with all tax things it's a pain really once you factor in sorting everything out and trying to make head or tale of their letters.

So the personal allowance for 2018/19 is 11850
My wife transfers 1185 (10% to me), so I now get 13035 and she gets 10665. At 20%, you save 1185 x 20%, or about £230

For 2019/20 the PA is 12500, so you transfer 1250, and save £250.

The low earner/ non earner can transfer around £1200 of their tax allowance to their partner. This should result in a reduction of their tax bill of about £238 over the year. Once you’ve authorised the transfer it happens every year till you tell them otherwise. I think it can be backdated a year as well. But the higher earner has to be a basic rate taxpayer

Final Note - The person giving up the allowance has to make the claim.

Note that it also works with dividends, which is the chief point, so it's useful if you have your own limited company. It actually mentions this in the HMRC notes, that it can still be worth applying where the higher paid partner doesn't pay tax, but the dividends make you a tax payer.

In this case the saving is not 20%, but 7;.5%

I’m nervous about applying if it’s going to cause tax nightmares.

I applied for this and it was a nightmare when I went back to work full time as they wouldn’t cancel it until the end of the tax year, so we ended up worse off. Nightmare for the few pennies it saved! We never got back pay either so no fat cheque when we applied even though I’d been eligible for years before I knew about it. Wish I’d not bothered!

@NoBaggyPants he does not have a company car or other taxable benefits

Tax code previously was 1048L (something like that?) now it is some numbers and M? I can't quite remember but I know the letter is M.

My tax code has L. Does it not have to have N? So I've read on moneyadvice website? I'm so confused I just don't know how it all works!

We use this as DH earns quite a bit less than the threshold. But I didn't know you could backdate? Would this apply to the tax year you got married or only the following one?

If you are the lower earner then your tax code should end with n and your partners should end in m.
Due to having to do an rti every month now your tax code can be changed for the following month so in theory you should never end up owing anything and they shouldn’t owe you anything. You won’t ever be entitled to back pay as it is a benefit you need to apply for.

I applied online, received forms in the post and sent them off over 6 weeks ago and haven't heard a word back. How long did it take for everyone else?