Marriage Allowance

zagfles

Does anyone know what happens if someone earns just under the HRT threshold but has interest within the PSA which pushes them over? Eg earnings £46,200, interest £300. Total £46,500, but no higher rate tax paid. Can they receive a MA transfer?

Consumerist

zagfles wrote: »

Does anyone know what happens if someone earns just under the HRT threshold but has interest within the PSA which pushes them over? Eg earnings £46,200, interest £300. Total £46,500, but no higher rate tax paid. Can they receive a MA transfer?

Since your total taxable income is greater than the threshold, I would would say you wouldn't be eligible for the MA transfer.

vacheron

zagfles wrote: »

Does anyone know what happens if someone earns just under the HRT threshold but has interest within the PSA which pushes them over? Eg earnings £46,200, interest £300. Total £46,500, but no higher rate tax paid. Can they receive a MA transfer?

You wouldn't be eligible. I fell foul of that due to the poor way the qualifying criteria was defined by HMRC when the scheme was first introduced.

They removed my allowance and made me repay £212 for being £18 over the threshold despite me not being required to pay a single penny of higher rate tax in that year. :mad:

zagfles

vacheron wrote: »

You wouldn't be eligible. I fell foul of that due to the poor way the qualifying criteria was defined by HMRC when the scheme was first introduced.

They removed my allowance and made me repay £212 for being £18 over the threshold despite me not being required to pay a single penny of higher rate tax in that year. :mad:

Thanks, not surprised but it does seem to contradict the legislation where the relevant bit says:

the individual is not, for the tax year, liable to tax at a rate other than the basic rate, the dividend ordinary rate or the starting rate for savings

http://www.legislation.gov.uk/ukpga/2014/26/section/11/enacted

vacheron

zagfles wrote: »

Thanks, not surprised but it does seem to contradict the legislation where the relevant bit says:
http://www.legislation.gov.uk/ukpga/2014/26/section/11/enacted

Yes, when I asked them what was going on when I first encountered the problem I was told for this they use "adjusted net income" which includes savings income but then does not allow the PSA to be deducted.

... when I then looked at their own page (the one I linked above) it then said you COULD deduct the PSA.

When I called back and queried them on this, the page suddenly changed the very next day" (no updated "last edited" date shown on the page, no page revision history update or anything, just a stealthy edit deleting the ability to deduct the interest PSA!)

This is the kind of sneakiness and non- transparency under which HMRC act (and which seems to have been noticed by quite a few others on the later pages of this thread)!

Consumerist

Might it be worth considering increasing your pension contributions to bring down your "adjusted" income ?

polymaff

zagfles wrote: »

Thanks, not surprised but it does seem to contradict the legislation where the relevant bit says:

http://www.legislation.gov.uk/ukpga/2014/26/section/11/enacted

Well, it is quite likely that it will if you use the "enacted" version of the legislation as your reference.

Always refer to the "Latest available" - and then the "view outstanding changes", too, if you want to be comparing like with like.

zagfles

polymaff wrote: »

Well, it is quite likely that it will if you use the "enacted" version of the legislation as your reference.

Always refer to the "Latest available" - and then the "view outstanding changes", too, if you want to be comparing like with like.

I can't see any changes relevant to this issue.

zagfles

vacheron wrote: »

Yes, when I asked them what was going on when I first encountered the problem I was told for this they use "adjusted net income" which includes savings income but then does not allow the PSA to be deducted.

... when I then looked at their own page (the one I linked above) it then said you COULD deduct the PSA.

When I called back and queried them on this, the page suddenly changed the very next day" (no updated "last edited" date shown on the page, no page revision history update or anything, just a stealthy edit deleting the ability to deduct the interest PSA!)

This is the kind of sneakiness and non- transparency under which HMRC act (and which seems to have been noticed by quite a few others on the later pages of this thread)!

Interesting, the legislation says nothing about "adjusted net income".

JimmyTheWig

If the lower earner is a tax-payer but pays more into their pension than they pay tax on, what happens?

E.g. They earn £13k, self employed. They pay £5k (gross) into private pension.
They are not a tax payer in the sense that they get more tax credited to their pension than they actually pay.
But they are a tax payer in the sense that they pay tax.
My gut feeling is that they should be able to benefit from this scheme (pension contributions help the higher paid spouse to qualify), but I don't think they will - if their tax free allowance is reduced then the amount of tax they actually pay will increase.