Overview
- HMRC and multiple outlets have this week urged married couples and civil partners to check eligibility and apply on GOV.UK so claims can be processed and tax codes adjusted for the current year.
- Under the rule, one partner who earns less than the personal allowance of £12,570 can transfer 10% of that allowance to their partner, who must be a basic-rate taxpayer in most of the UK.
- After a transfer the receiving partner’s tax-free allowance rises to £13,830, which typically lowers tax bills by up to £252 a year for the household.
- Claims can be backdated for up to four previous tax years, allowing eligible couples who have not claimed before to receive a lump sum of up to £1,260 paid by cheque or bank transfer.
- Around 2.1 million eligible people have not claimed, and advocates including Martin Lewis say the allowance is a simple way to ease pressure from the personal allowance freeze that began in 2021.