We were ticking off our new tax year checklist for last week's Finance Fridays. This week we are talking about Marriage Allowance.
Mr JibberJabber and I have this week celebrated 19 years of marriage. When we were first married we were able to claim the Married Couple's Allowance however this was abolished by the then Chancellor Gordon Brown in April 2000. Over the years there have been calls to bring it back in some form or another and this was done with the introduction of the Marriage Allowance in April 2015. It is not something that is automatically granted and you will need to apply to HMRC in order to receive it. Let's have a look at who can claim it and how much it is worth.
To be eligible all of the following must apply:
- You need to be legally married or in a Civil Partnership. People who co-habituate but are not married or in a Civil Partnership are not eligible. The status of 'common law' spouse has never been legally recognised in England and ceased to exist in Scotland from 2006.
- One of you earns nothing or less than £11,500 (for the current tax year 2017/18) whilst the other earns between £11,501 and £45,000 (in Scotland the upper limit is £43,000).
You must apply online through the government website. Make sure you have both of your National Insurance numbers to hand plus some form of identification as requested. After that you will get an email confirming your application. If you already have a Government Gateway account you can also apply through your online personal tax account. If you want to find out how much you could be due you can use this online calculator.
As Marriage Allowance came into force from April 2015 you can also make a backdated claim for the last two tax years if you were eligible for it. For 2015/16 your earnings needed to be less than £10,600 for one partner and between £10,601 and £42,385 for the other. This rose in 2016/17 to less than £11,000 and between £11,001 and £43,000. For backdated claims you should receive a cheque for the amount due. For claims in the current tax year the higher earner's tax code should be adjusted accordingly.
You don't need to apply for Marriage Allowance each year however you will need to contact HMRC if your circumstances change. This means if one of you die or you are no longer eligible because you have decided to divorce or dissolve your civil partnership. You will also need to tell HMRC if your income changes.
Are you eligible for Marriage Allowance? Have you claimed it?
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