Joint income

Lepista

Hi, I wonder if anyone can elp me.

I recently moved to a job where I have quite a good wage - I am now taxed 40%.

However, My partner (not married) does not work, and she does not qualify for any income support or anything. we are nowhere near retirement.

Is there any way that we can use her taxable allowance in reducing my tax bill?

It just seems unfair in that if we were both earning 1/2 my salary, we would be much better off tax wise. Because I earn it all, then we are severely penalised.

Can anyone advise?

zzzLazyDaisy

Do you have any savings in taxable accounts? She can register as a non tax payer and income from savings will be tax free up to the level of the personal allowance, plus another band that is only taxed at 10% (this band still exists for savings).

Whereas you, as a higher rate tax payer, will have to declare all savings and will be clobbered for another 20% tax on the interest earned, on top of the 20% automatically deducted by the savings institution.

Of course, if the relationship went belly up, any money in an account in her sole name would be hers.......

chriiiiiiiis

We are taxed independently.

zzzLazyDaisy

chriiiiiiiis wrote: »

We are taxed independently.

And your point is..........

What I meant (but probably didn't explain properly) OP - You could move any savings into an account in your OH sole name and so avoid having to pay tax on the interest.

chriiiiiiiis

What are you on about?

My point was the statement that I made and it wasn't a response to your post.

Original poster: You cannot reduce your direct tax bill by means of using your partner's tax free allowance.

You can however avoid paying tax on all of your bank interest (if any) by moving some of your savings to your partner's savings account.

You'll still be taxed at 40% on your wages though, to answer your question.

hansoff

chriiiiiiiis wrote: »

What are you on about?

My point was the statement that I made and it wasn't a response to your post.

Original poster: You cannot reduce your direct tax bill by means of using your partner's tax free allowance.

You can however avoid paying tax on all of your bank interest (if any) by moving some of your savings to your partner's savings account.

You'll still be taxed at 40% on your wages though, to answer your question.

"We are taxed independently".

Who are taxed independently?

fengirl_2

Husbands and wives are taxed independently - and many women fought for many years for this right!

Mikeyorks

Lepista wrote: »

Can anyone advise?

Yes ..... that's how it works ..... for all of us.

Strange to get this twice in a week! :-

http://forums.moneysavingexpert.com/showthread.html?t=1306709

Lepista

We're taxed independently. OK, fair enough.

BUT then MY wage is taken into account when determining any of her benefits. Just because we share a house?