Marriage Allowance

tasticz

Person A owns a limited company and takes a salary less than the minimum threshold (approx 8k/year) and rest of the earning is taken as dividends.

As person A doesn't pay any tax on his salary, can the allowance be transferred to person B who pays 20% tax?

Dazed_and_confused

All depends on the amount of dividend income. The Marriage Allowance tax law has some complex rules about dividends so it depends on the amounts involved.

tasticz

Dazed_and_confused wrote: »

All depends on the amount of dividend income. The Marriage Allowance tax law has some complex rules about dividends so it depends on the amounts involved.

The dividends takes the person A above salary threshold limit

Robson65

After I told a friend about this she applied and she got her claim backdated but when they sent her the money she was owed they taxed it ? Is that right ? Should she be paying tax on tax relief ?

Many thanks
Robson

polymaff

Dazed_and_confused wrote: »

All depends on the amount of dividend income. The Marriage Allowance tax law has some complex rules about dividends so it depends on the amounts involved.

Actually, it isn't complex. FA 2016 contains a lengthy clarification which can be summarised as: Assume that the Dividend Allowance doesn't exist.

polymaff

tasticz wrote: »

The dividends takes the person A above salary threshold limit

The what? . . . .

polymaff

Robson65 wrote: »

After I told a friend about this she applied and she got her claim backdated but when they sent her the money she was owed they taxed it ? Is that right ? Should she be paying tax on tax relief?

What was the amount she received and what was the tax demanded?

MothballsWallet

Does anyone know if there's an application form for this allowance as my wife's out of the UK at the moment to see her family and she wants to apply for it, but internet connections where she is aren't always the most reliable?

Something that can be saved to Word/PDF would be best, if possible.

sheramber

MothballsWallet wrote: »

Does anyone know if there's an application form for this allowance as my wife's out of the UK at the moment to see her family and she wants to apply for it, but internet connections where she is aren't always the most reliable?

Something that can be saved to Word/PDF would be best, if possible.

https://www.gov.uk/government/uploads/system/uploads/attachment_data/file/366958/18.pdf

Dazed_and_confused

Robson65

After I told a friend about this she applied and she got her claim backdated but when they sent her the money she was owed they taxed it ? Is that right ? Should she be paying tax on tax relief ?
Many thanks
Robson

Someone has got very confused somewhere along the line. Anyone who applies for Marraige Allowance can never ever pay less tax as a result. They either pay the same or more. It is their spouse who could pay less but never the applicant. If she applied as you have stated then she cannot expect to pay less tax.

First port of call would probably be to check exactly what she has done.