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  • FIRST POST
    • Former MSE Sam M
    • By Former MSE Sam M 2nd Jun 15, 4:39 PM
    • 238Posts
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    Former MSE Sam M
    Marriage Allowance
    • #1
    • 2nd Jun 15, 4:39 PM
    Marriage Allowance 2nd Jun 15 at 4:39 PM
    Hi!

    This is the discussion thread for the



    Click reply below to discuss. If you haven’t already, join the forum to reply. If you aren’t sure how it all works, read our New to Forum? Intro Guide.


    Thanks folks ,
Page 51
    • dori2o
    • By dori2o 24th Sep 17, 10:28 AM
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    dori2o
    Part of the problem is that the papers just keep getting it wrong. Late last night the BBC printed an article about how half the people entitled had not claimed. They then went on to say that the person paying tax could give their partner 10% of their tax code. Definitely not true. They have corrected it now to read the person not paying tax.

    How many people thinking of claiming do not understand the process & just how easy is it to find out. If HMRC are so sure 2.2 million are underclaiming why not send out a letter to them (explaining properly) instead of letting the newspapers print bul*****?
    Originally posted by badmemory
    Why should they send a letter costing the taxpayer money.

    All of the information needed is online.

    Plus HMRC won't know who these people are. If you have not told HMRC that you are married then they won't know you are eligible, and even if you have told them you're married your spouses NINO may not be held on your records to find their record and its not as simple as assuming that someone who lives at the same address with the same surname is a spouse.

    HMRC should not have to hold the hand of intelligent individuals. Those individuals should take the time to look at the information, check they are eligible and make the claim themselves.
    To equate judgement and wisdom with occupation is at best . . . insulting.
    • dori2o
    • By dori2o 24th Sep 17, 10:35 AM
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    dori2o
    Then maybe it is time HMRC produce a booklet called something along the lines of your responibilities & send it to every single tax payer. Unfortunately, most of us pick up our knowledge of tax as we go, if you happen to miss a bit the HMRC seem to delight in charging penalties not for the second infraction which would be understandable but for the first. For something which to a layman can seem totally illogical. Most of us have spent all our working lives on PAYE & a few years ago would never have had to get involved with self assessment just because you get child benefit.
    Originally posted by badmemory
    Again, why produce a booklet when all of the information is available online and takes seconds to access.

    To send letters and produce material such as booklets costs significant amounts of money, HMRC's budget is reducing year on year which is why everyone should register for the Personal Tax Account as automation and self service will become the norm within the next decade to make sure HMRC can meet the demand with fewer resources (including fewer staff).
    To equate judgement and wisdom with occupation is at best . . . insulting.
    • dori2o
    • By dori2o 24th Sep 17, 10:41 AM
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    dori2o
    Is that fair? I don't think HMRC are obliged to give out tax planning advice, and this whole "story" was the result of a FOI request from Royal London - who are obviously keen to create copy. Only about a quarter of people I know who are entitled to claim higher rate relief on their DB pension contributions actually do so, I don't think it's HMRC's place to advise them either.
    Originally posted by bob bank spanker
    It's not HMRC's place to provide advice on tax planning, that's for an IFA or accountant to do.

    HMRC are merely the collectors of tax, nothing more nothing less.

    All of us on PAYE have been mollycoddled for far to long by not having to deal with tax issues because our 'employer does it'.

    Things are changing however and people are going to have to have a basic understanding of tax from here on.
    To equate judgement and wisdom with occupation is at best . . . insulting.
    • Consumerist
    • By Consumerist 24th Sep 17, 10:45 AM
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    Consumerist
    You, included. The recipient's "allowance" - sloppy terminology - does NOT increase one jot.
    Originally posted by polymaff
    What took you so long? The usual criticism of other people's attempts but without any detail as to a "correct" explanation.

    So where is your explanation, please?
    Warning: In the kingdom of the blind, the one-eyed man is king.
    • Consumerist
    • By Consumerist 24th Sep 17, 11:42 AM
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    Consumerist
    . . . The recipient's "allowance" - sloppy terminology - does NOT increase one jot.
    Originally posted by polymaff
    For the record, from <HMRC>:
    Marriage Allowance lets you transfer £1,150 of your Personal Allowance to your husband, wife or civil partner
    But polymaff clearly thinks he knows better.

    In practice, for the current year your tax codes will change as if your allowances had changed. For previous years, the recipient should get a rebate.
    Warning: In the kingdom of the blind, the one-eyed man is king.
    • Dazed and confused
    • By Dazed and confused 24th Sep 17, 1:15 PM
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    Dazed and confused
    Polymaff is correct, the applicant loses 10% of their personal allowance but the recipient is not entitled to any additional personal allowance.

    HMRC' practice might be to send an amended tax code showing marriage allowance as an extra allowance but when you get to the year end, either with a self assessment return or PAYE calculation, the recipients PA remains the standard amount and they simply get a tax credit deducted from whatever their tax liability is.

    It seems to essentially be identical to how Married Couples Allowance works now but with a fixed amount to start with and relief given at 20% not 10%. So for 2016:7 the tax credit would be £220.

    For many it won't make a jot of difference but for some it can make a huge difference. Check any clients who have taken State Pension deferral lump sum for example.
    • Consumerist
    • By Consumerist 24th Sep 17, 1:39 PM
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    Consumerist
    . . . For many it won't make a jot of difference but for some it can make a huge difference. Check any clients who have taken State Pension deferral lump sum for example.
    Originally posted by Dazed and confused
    Thanks for taking the trouble to explain the detail. My intention was only to explain why the poster had ended up owing tax which they clearly had not expected. I didn't think the minutia would have made things any clearer.

    Giving a better explanation is one thing - taking potshots without an explanation is something else.
    Warning: In the kingdom of the blind, the one-eyed man is king.
    • Dazed and confused
    • By Dazed and confused 24th Sep 17, 1:56 PM
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    Dazed and confused
    I think everyone seems to add confusion with this, BBC have been running stuff this weekend that perpetuates the myth that your income has to be £10,350 or less to apply. No consideration given to the actual legislation or the three 0% rate bands which can, for some (the minority probably), mean you can easily have £20,000 taxable income and apply and as couple you would still benefit if spouse has enough income taxable at basic rate.

    To me that goes some way to explaining why there is apparently low take up.
    • polymaff
    • By polymaff 24th Sep 17, 2:54 PM
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    polymaff
    What took you so long? The usual criticism of other people's attempts but without any detail as to a "correct" explanation.

    So where is your explanation, please?
    Originally posted by Consumerist
    I don't owe you any explanation - and your vulgar responses justify that stance. If you make false statements they will be rebutted by those who know better.

    Perish the thought that instead of demanding an explanation you should challenge your own prejudices.

    And, as a matter of record, you have, in this thread, had that untruth unmasked and explained as false several times.
    Last edited by polymaff; 24-09-2017 at 3:56 PM.
    • badmemory
    • By badmemory 24th Sep 17, 3:31 PM
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    badmemory
    The problem with advertising campaigns is that the newspapers KEEP printing the wrong information. Last nights BBC original story was completely wrong.

    What percentage of the country is actually able to access their personal tax account? Or even for that matter google! Also it is all very well saying things are going to have to change, but if you don't tell anybody that then how do they know. Well until they get the penalty charges anyway.

    I also wonder if even as many as 20% of the population knows that there is such a thing as a personal tax account.
    Last edited by badmemory; 24-09-2017 at 3:55 PM.
    • polymaff
    • By polymaff 24th Sep 17, 3:53 PM
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    polymaff
    I think everyone seems to add confusion with this, BBC have been running stuff this weekend that perpetuates the myth that your income has to be £10,350 or less to apply. No consideration given to the actual legislation or the three 0% rate bands which can, for some (the minority probably), mean you can easily have £20,000 taxable income and apply and as couple you would still benefit if spouse has enough income taxable at basic rate.
    Originally posted by Dazed and confused
    As I mentioned yesterday, the media tend to quote HMRC advice which is itself hopelessly wrong. Moneybox recently did this over MAT. What is worse, they used an "expert" to validate their errors. It is not then too suprising that those falsehoods propagate further - including on these forums.

    You're right to point at the legislation. To have a clear understanding of MAT - or any other related issues - you have to study the legislation. That is not the end of it, though. HMRC have the responsibility of converting the intent of the legislation into working processes. You need to study their processes to decide if each is:

    1. what was intended, or,
    2. what is not implied but valid, or,
    3. what is wrong.

    With regard to MAT, HMRC have produced all three classes of process.

    A good example of type 2 is the way the recipient receives value. I understand, from HMRC, that they did originally mean to do this as a true transfer of Personal Allowance, but reckoned that it was too difficult to make an unexploitable process and so settle for the clumsier but robust idea of a payment direct to the recipient. Yes, it is a bodge, and like most bodges it will probably bite them back later, but it is definitely type 2 - valid,

    The obvious type 3 error is "who is a valid applicant?" HMRC's stance on this also has history. First was, maybe, a mis-reading of the legislation. By the legislation there are two classes of applicant. One class can only apply if taxable income does not exceed their personal allowance, the other class can only apply if they are not classed as higher-rate tax-payers. Has HMRC recognised the two classes? I've asked but got no response.

    The other historical, type 3, aspect is the benefit of MAT. At first the people I communicated with within HMRC understood that there could be a benefit to basic-rate taxpayers but that understanding has apparently sunk under the weight of the mis-understanding of the legislation mentioned above - and my, higher-level, contacts opinion that it was OK for some to apply for MAT even though they were basic rate tax-payers seemed to fray into "don't bother - there will be no benefit" and ended up as "you cannot apply".

    To me that goes some way to explaining why there is apparently low take up.
    Originally posted by Dazed and confused
    Possibly, although the non-appliers are, I would think, predominantly those who don't see/hear/read the misinformation you mention. After the recent Moneybox shambles over these details we discuss here on MSE, Paul Lewis did the make the point - and it is a valid one - that they were receiving lots of messages from listeners who were going to give it a go - and that this was a good thing. How many of those actually did apply, how many of those actually were "permitted" to apply - and how many have nett-benefitted - who knows?
    Last edited by polymaff; 24-09-2017 at 3:57 PM.
    • dori2o
    • By dori2o 24th Sep 17, 7:05 PM
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    dori2o
    The problem with advertising campaigns is that the newspapers KEEP printing the wrong information. Last nights BBC original story was completely wrong.

    What percentage of the country is actually able to access their personal tax account? Or even for that matter google! Also it is all very well saying things are going to have to change, but if you don't tell anybody that then how do they know. Well until they get the penalty charges anyway.

    I also wonder if even as many as 20% of the population knows that there is such a thing as a personal tax account.
    Originally posted by badmemory
    Every person of working age + has a personal tax account, currently around 14.5 million have activated their account.

    The Marriage allowance has been promoted by HMRC on TV and Radio, all the info needed is on the website including the ability to make the claim, it's been reported on by the Times, the Mail, The Guardian, The BBC, The Sun, MSE, The Money Box, Rip Off Britain (show dealing with tax refund companies), ITV news, Sky news. It was in the budget 2013 so would have been in every newspapaer for several days after.

    Tax is, and always has been, the responsibility of the individual.

    Most people are intelligent beings and in the modern world the majority of people can use the internet. In 10 years time the number of people who cannot use the internet will be a very small minority.

    It's not HMRC's job to hold everyone's hand and guide them to every bit of guidance on the website etc.

    People need to start taking responsibility for themselves.
    To equate judgement and wisdom with occupation is at best . . . insulting.
    • polymaff
    • By polymaff 24th Sep 17, 7:51 PM
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    polymaff
    Every person of working age + has a personal tax account, currently around 14.5 million have activated their account..
    Originally posted by dori2o
    No they don't. Many of the self-employed only have access to an HMRC business tax account. When they attempt to log in directly, or from their business tax account, to their personal tax account they pass through another security check and are then routed to their business tax account. The two are different.

    The Marriage allowance has been promoted by HMRC on TV and Radio, all the info needed is on the website including the ability to make the claim, it's been reported on by the Times, the Mail, The Guardian, The BBC, The Sun, MSE, The Money Box, Rip Off Britain (show dealing with tax refund companies), ITV news, Sky news. It was in the budget 2013 so would have been in every newspapaer for several days after.
    Originally posted by dori2o
    Virtually all coverage is derived from one source - HMRC documentation. As this has been, and still is, significantly flawed, the public has virtually no access to the true facts

    Most people are intelligent beings and in the modern world the majority of people can use the internet. In 10 years time the number of people who cannot use the internet will be a very small minority.
    Originally posted by dori2o
    What evidence could you possibly have for these statements?

    It's not HMRC's job to hold everyone's hand and guide them to every bit of guidance on the website etc
    Originally posted by dori2o
    "We’ll help you understand what you have to do and when you have to do it." - HMRC Charter

    EDIT: I agree with your other two statements.
    Last edited by polymaff; 24-09-2017 at 8:02 PM.
    • cjs180uk
    • By cjs180uk 28th Sep 17, 4:44 PM
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    cjs180uk
    backdated tax allowance waiting time
    Hello people just looking for some information we made our application for the tax allowance earlier in the year and they have agreed that we are entitled to it and have confirmed it will be backdated to 2015. The amendment to my tax allowance has been done but we have had no information or seen any payment for the backdated allowance that they stated would be paid by cheque within a few weeks. Has anyone had a similar issue or has any idea how long this process takes to complete. Any information would be helpful thanks
    • Hakneyed
    • By Hakneyed 1st Oct 17, 2:05 AM
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    Hakneyed
    Advice needed
    Hi All

    I applied for the Marriage tax allowance. My salary is 43k. I have realised that a likely ( very likely but not certain) bonus of 3 - 5k will push me over the 45k.

    In these circumstances will HMRC claw the entire £1,150 allowance back. Will the govt just take back the 20% tax, around £200 from next years tax allowance?

    Or is there a slim hope that i am still entitled to some of the tax break from my non working wife?

    I feel i already know the answer but thought it worth checking.

    Thanks
    Last edited by Hakneyed; 01-10-2017 at 2:38 AM.
    • sheramber
    • By sheramber 1st Oct 17, 2:51 PM
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    • 2,757 Thanks
    sheramber
    Hi All

    I applied for the Marriage tax allowance. My salary is 43k. I have realised that a likely ( very likely but not certain) bonus of 3 - 5k will push me over the 45k.

    In these circumstances will HMRC claw the entire £1,150 allowance back. Will the govt just take back the 20% tax, around £200 from next years tax allowance?

    Or is there a slim hope that i am still entitled to some of the tax break from my non working wife?

    I feel i already know the answer but thought it worth checking.

    Thanks
    Originally posted by Hakneyed
    it is an all or nothing transfer.
    • polymaff
    • By polymaff 1st Oct 17, 3:45 PM
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    • 741 Thanks
    polymaff
    Hi All

    I applied for the Marriage tax allowance. My salary is 43k. I have realised that a likely ( very likely but not certain) bonus of 3 - 5k will push me over the 45k.

    In these circumstances will HMRC claw the entire £1,150 allowance back. Will the govt just take back the 20% tax, around £200 from next years tax allowance?

    Or is there a slim hope that i am still entitled to some of the tax break from my non working wife?

    I feel i already know the answer but thought it worth checking.

    Thanks
    Originally posted by Hakneyed
    The above doesn't make sense. If you've applied for MAT then you intend that you will transfer part of your personal allowance TO your wife. Really?

    Whichever of you two has applied will have had to confirm that the recipient's income was less than £43,000 for 2016/17, or will be less than £43,000 or £45,000, as applicable, for 2017/18. If the latter, the application has been a bit premature?

    There's no point in making an application for MAT during the relevant tax year. No benefit will be realised until after the end of that tax year and, in the meantime the applicant may have made a false declaration - as maybe the case here.

    You really need to get your facts together and call HMRC.

    p.s. I'm just quoting "less than" from form SA100. I believe that the true meaning of the legislation is "no more than"
    Last edited by polymaff; 01-10-2017 at 3:49 PM.
    • Dazed and confused
    • By Dazed and confused 1st Oct 17, 5:59 PM
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    Dazed and confused
    Well if the op is on PAYE they will be getting the benefit during the course of the year through a higher tax code.

    It seems likely they will have to repay it as a later point although I don't believe either the 43k or 45k figures really matters but more whether they have to pay any higher rate tax or not. Probably will do but with pension or gift aid payments they might not do, particularly if income is borderline in first place.

    In this situation, where the actual facts will only be known after the tax year ends, usually means any tax which needs to be repaid will normally be collected through a reduced tax code for 2019:20 tax year, not the 2018:19 year.
    • Mrsmunro26
    • By Mrsmunro26 4th Oct 17, 3:59 PM
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    • 0 Thanks
    Mrsmunro26
    Hello!

    Hope I'm posting this in the right place! I applied for marriage allowance at the beginning of this year when I was working part time and my husband full time, so he was the taxpayer. Our circumstances have now changed, he is no longer working (he receives ESA) and I'm working full time, paying tax and soon to go on maternity leave. How do I switch it over? Is it best to cancel and make a new claim?

    Thank you!
    • Consumerist
    • By Consumerist 4th Oct 17, 4:39 PM
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    • 2,307 Thanks
    Consumerist
    Hello!

    Hope I'm posting this in the right place! I applied for marriage allowance at the beginning of this year when I was working part time and my husband full time, so he was the taxpayer. Our circumstances have now changed, he is no longer working (he receives ESA) and I'm working full time, paying tax and soon to go on maternity leave. How do I switch it over? Is it best to cancel and make a new claim?

    Thank you!
    Originally posted by Mrsmunro26
    As you are currently the donor, you can cancel the current transfer of allowance at any time. Your husband will then need to claim to transfer part of his allowance to you.

    You can cancel online but I'm not sure whether the change will apply before the start of the next tax year. Best talk to HMRC first.
    Warning: In the kingdom of the blind, the one-eyed man is king.
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