Marriage Allowance

Dazed_and_confused

Seems straightforward then, you wouldn't need to get anything if your income is that low.

Your husband should get calculations for 2015:16 and 2016:17 with a cheque for the total tax overpaid for the two years combined (all things being equal approx £430).

If that doesn't turn up next week probably best for your hubbie to phone and ask what's happened.

Beth1101

OK I just thought they'd do it all at once rather then separate letters.

Dazed_and_confused

You are right, I don't know why they wouldn't have done all three of the previous years all together but given that they haven't then the remaining two will presumably be done together.

But maybe not!

If your hubby hasn't heard by now probably best to phone and ask what's happening.

LukeBrown_2

Hi all,

Asking on behalf of parents. As we're now approaching the end of the current tax year, and my parents are likely eligible for the full 4 years of the tax allowance, would it be better to wait until the very start of the next tax year (April) to apply or just apply now (March) instead?

Reading up on the GOV.UK site, it looks like any previous years are paid out by cheque whereas the "current year" is obviously cheaper tax each month. My parents would much prefer as much of the allowance to be paid by cheque as possible, so is it better to apply now or later (bearing in mind you can only backdate by 4 tax years). We would have applied straight away but considering we could change the tax code at the start of a new tax year, we're wondering if this is more straightforward and would result in a higher cheque payment, as it would then be 4 full years.

Thanks all

Dazed_and_confused

You don't say who is going to be applying (it's the person giving away part of their Personal Allowance) but if they wait until the new tax year then it would definitely be too late for anything to be refunded via their wages/pension.

So anything due back to the other parent would be by cheque or sometimes a bank transfer (HMRC send a calculation and you go onto gov.uk and put in your bank details yourself so the money is transferred).

The revised tax codes would then just apply for 2019:20 tax year onwards.

and my parents are likely eligible for the full 4 years

Most married couples are eligible, the two common situations where they wouldn't be are if one is claiming Married Couple's Allowance (similar, but more beneficial, allowance for people born in 1935(?) or earlier) or either are considered to be a higher rate payer.

The trick is to only apply when they, as a couple can benefit. So it is important to check their taxable income for each year. If they apply and both have say £30k taxable income in 2016:17 they are eligible for that tax year. But the applicant will get a bill for approx £230 and the recipient a refund of approx £230.

Going off other posts on here this is likely to upset your parents so be certain about what your'e getting them to do before pushing the button.

If the applicant has savings interest or dividend income it is sometimes still beneficial to apply even if their taxable income would make them liable to more tax by applying. This is because those income types can sometimes be taxed at a 0% tax rate.

williamalex1

My wife applied online for the married tax allowance through the official GOV HMRC web page , 2 weeks later I received a cheque for £661.
A week later she received a letter saying she had under paid her tax by £634, and they want it back.

Is this correct ? why give with one hand and take it back with the other ?
thanks in advance.

polymaff

williamalex1 wrote: »

Is this correct ? why give with one hand and take it back with the other ?
thanks in advance.

Could well be so. You'd have to tell us the gross taxable income for each of you for one of those years to get a meaningful response.

Being eligible to elect for MAT doesn't necessarily mean that you, plural, will benefit. There have been many cases where the effect has been to shift money from one party to the other.

Dazed_and_confused

Between you you are apparently £27 better off.

A lot of married couples will be eligible for Marriage Allowance but not everyone can benefit.

The most likely explanation is that your wife has applied for some tax years where you are eligible but cannot benefit overall i.e. you get a refund and she gets a bill for a corresponding amount.

But it could be it was worthwhile doing for each and every year but only by a small amount, say £9/year, which would give you, as a couple, a £27 saving overall.

Only your wife can say why she applied for tax years where doing so would increase her liability. Did she fully understand what she was getting into before applying?

Consumerist

williamalex1 wrote: »

My wife applied online for the married tax allowance through the official GOV HMRC web page , 2 weeks later I received a cheque for £661.
A week later she received a letter saying she had under paid her tax by £634, and they want it back.
Is this correct ? why give with one hand and take it back with the other ?
thanks in advance.

In short, if your wife transfers some of her PA to you then that means her allowance has been reduced by the same amount. If her total taxable income exceeds her remaining allowances then she may be liable to pay tax on it.

For 2018/19 - If your wife's total taxable income was more than £11,850 (Personal Allowance) - 1,190 (Marriage allowance) = £10,660 then she may be liable for tax on the excess.

williamalex1

Thanks guys, I'll check both our P60 incomes , and get back to you.
It just seems silly paying out, then asking most of it back.