Marriage allowance is a genuinely useful tax saving for eligible couples, but over the past year we’ve seen a number of stories about people getting caught out by the same issue! They’ve claimed it, their circumstances changes, and they didn’t update HMRC.
This meant a tax bill they weren’t expecting!
If you’ve claimed Marriage Allowance and your situation has changed recently, this post is for you.
And, if you’ve never heard of Marriage Allowance before, we’ve got you covered too:
➡️ You can read out full guide to how it works and how to claim it, here.
A quick recap
Marriage Allowance lets the lower earner in a married couple or civil partnership transfer £1,260 of their unused Personal Allowance* to their partner, reducing their partner’s tax bill by up to £252 a year.
It sounds pretty simple, and claiming it is, but the problem comes when circumstances change.
*Your Personal Allowance is the amount you can earn each year before you start paying Income Tax. For most people, that’s currently £12,570. Anything you earn below that figure is tax-free.
Once you claim it, HMRC keeps it going automatically
This is the part that might catch some people out.
Once you sign up to this, HMRC will automatically carry the claim forward every year. They don’t check whether you’re still eligible. They don’t send a reminder asking if anything has changed, it will just keep rolling until you tell them to stop.
So, if you circumstances change and you don’t cancel, you could end up receiving a tax reduction you’re no longer entitled to. At some point, HMRC will want that back 😅
When do you need to cancel?
You should contact HMRC to cancel your Marriage Allowance claim if:
- The lower earner’s income has risen above £12,570
- The higher earner has moved into the higher rate tax band (income over £50,270, or £43,662 in Scotland)
- You’ve separated or divorced
- Your partner has passed away
If any of these apply to you, even if it happened a little while ago, it’s worth acting sooner rather than later. The longer you leave it, the more the tax could be building up.
HMRC also state that the person who made the claim needs to cancel. However, if your relationship has ended, either of you can cancel.
How to cancel
You can cancel your Marriage Allowance claim online or by phone through HMRC directly. One thing to note: you can’t cancel it through your Self Assessment tax return, so if that’s how you normally manage your tax, you’ll need to take a separate step to sort this. You can cancel your Marriage Allowance on the HMRC website.
Already sorted it, but not sure about backdating?
If you’ve never claimed Marriage Allowance but think you might have been eligible in previous years, it’s not too late! You can backdate a claim to the 2022/23 tax year, which could mean a welcome lump sum coming your way.
➡️ You can find out more about eligibility and how to apply in our full Marriage Allowance guide, here.
Not sure about any of it?
If you’re unsure whether your claim is still valid, whether you owe anything, or whether you should have been claiming in the first place, don’t fret, these things are usually straightforward to navigate with the right support… that’s where we come in!
You can get in touch with our team by phone, email, or WhatsApp:
Call us 01872 267 267, email us [email protected], or message us on WhatsApp 0777 49 39 111
Please note: this post is intended as general guidance. For advice specific to your situation, please get in touch with us directly.
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