MSE News: Couples now able to register to shift tax allowance between spouses

Lifeisforliving19

Was doing my self assessment this year but my self employed job is only a little one and I don't earn enough to pay tax. I also have an small part time,employed position, which again I don't pay tax on. I have been off setting my tax allowance to my husband for the last 3 years. So this year it asked on my self assessment if I wanted to do this. When I input my husbands details, it said that they did not match the details the HMRC held on file and after 3 attempts it deleted that section from the self assessment form. Does that mean we are still benefiting from this or will it have cancelled it and I would have to re apply for it. I just find the whole thing very comfusing

ashleighpr2

My wife earns around £35k and my income is around £30k, therefore way over the limit to qualify.


However, last year my income was only £10k and therefore didn't pay any tax.
Therefore, is it possible to transfer my unused tax allowance for 2018/19 to my wife retrospectively without having to transfer it for 2019/20 (as I'll be earning over £12500pa).

polymaff

ashleighpr2 wrote: »

My wife earns around £35k and my income is around £30k, therefore way over the limit to qualify..

No - you are not over the "limit to qualify". You just might not - as a couple - benefit from MAT in 19/20.

You can wiggle in and out - carefully - but I suspect that you could just opt into MAT for 18/19 as you suggest - and then leave the MAT election in place.

For UK taxpayers, the "limit to qualify", by the way, is that neither of you are, or would be as a result of an MAT election, become higher rate tax-payers should the dividend allowance not exist. It has nothing to do with the personal allowance.

Dazed_and_confused

My wife earns around £35k and my income is around £30k, therefore way over the limit to qualify.

No, you both have low enough to qualify/be eligible to apply from Marriage Allowance. But unless one of you gets a lot of dividend income there will be no benefit in applying (for you as a couple) on that level of income

However, last year my income was only £10k and therefore didn't pay any tax.
Therefore, is it possible to transfer my unused tax allowance for 2018/19 to my wife retrospectively without having to transfer it for 2019/20 (as I'll be earning over £12500pa).

Now that we are in the 2019:20 tax year you should be able to apply for 2018:19 as a one off year.

But you cannot transfer your "unused tax allowance". Applying for Marriage Allowance means you get a reduced Personal Allowance (£10,660 in 2018:19) and your wife will get a tax credit off her tax bill (worth £238 in 2018:19). She does not get an additional £1,190 Personal Allowance.

vindaloo

Just completed my 2108/19 SA and the marriage allowance transfer is missing from the calculation, which has not been the case for the past 4 years. I telephone HMRC who suggested I submit the 'incorrect' return and telephone again in about 1 week to complain. Apparently there is nothing they can do before the return is submitted. Hopefully they will correct it, as according to my submitted return I owe them £238!