Marriage Allowance

Darksparkle

Littlejohn1984 wrote: »

My wife and I will be discharged from bankruptcy on 9th April 2016. She works part time and me full time. Will we have to wait until 9th April to transfer her allowance to mine and can we backdate to when the allowance started last year?

Do you meet the eligibility criteria?

Littlejohn1984

Ye we are eligible, iv had a look but wasn't sure where we stood just with both currently having nil tax codes.

Consumerist

Littlejohn1984 wrote: »

Ye we are eligible, iv had a look but wasn't sure where we stood just with both currently having nil tax codes.

Not sure how this might work in the case of a nil tax code. The Marriage Allowance would then give the donor an effective negative code and I'm not sure how that may be implemented. I suggest having a word with HMRC.

Because of the low uptake for this allowance, MPs are currently discussing whether to allow future claimants to backdate to the current tax year for the next four years. As far as I know, no decision has yet been made.

sheramber

The Marriage Allowance is not a sum of money that is paid out. It is a reduction in the amount of tax deducted.

On nil tax code you will not have paid any tax so there is none to be refunded.

peachespeaches

Thanks to whoever spotted this, I have applied and it only took me 5 minutes.

Darksparkle

Consumerist wrote: »

I thought a nil tax code meant zero tax allowance. Is that not the case?

NT - means no tax should be deducted.
0T - means no personal allowance.

NT can be used in bankruptcy cases - http://www.hmrc.gov.uk/manuals/pommanual/PAYE11010.htm#IDAOVO0B

I think they would need to call HMRC. As far as I am aware, even an NT code is used, tax still ultimately needs to be paid, it just isn't deducted at source.

debtaghh

Hi,

I am wondering if anyone can help me. I earn less than the £10600 but my husband earns about £44k however he pays about £400 per month towards his pension and was wondering if they take this into account when working out if you're entitled to marriage allowance? How do you know if you pay 40% tax as it doesn't stipulate anywhere how much percentage my husband pays on his payslip. Or is it just they will see him earning 44k therefore we can't transfer it over?

Thanks in advance.

Darksparkle

debtaghh wrote: »

Hi,

I am wondering if anyone can help me. I earn less than the £10600 but my husband earns about £44k however he pays about £400 per month towards his pension and was wondering if they take this into account when working out if you're entitled to marriage allowance? How do you know if you pay 40% tax as it doesn't stipulate anywhere how much percentage my husband pays on his payslip. Or is it just they will see him earning 44k therefore we can't transfer it over?

Thanks in advance.

It's based on what his taxable income.

Eg your gross income is £43,000 and you pay £2,000 into a pension before tax. Therefore your taxable pay is £41,000.

His payslips should show his taxable income.

Consumerist

debtaghh wrote: »

Hi,

I am wondering if anyone can help me. I earn less than the £10600 but my husband earns about £44k however he pays about £400 per month towards his pension and was wondering if they take this into account when working out if you're entitled to marriage allowance? How do you know if you pay 40% tax as it doesn't stipulate anywhere how much percentage my husband pays on his payslip. Or is it just they will see him earning 44k therefore we can't transfer it over?

From your numbers his taxable income is ca. £44k - £4.8k = 39.2K and the income threshold for MA is £42,385 so it would seem that he is not a higher-rate taxpayer and would therefore be eligible for MA.

Consumerist

Darksparkle wrote: »

NT - means no tax should be deducted.
0T - means no personal allowance.

NT can be used in bankruptcy cases - http://www.hmrc.gov.uk/manuals/pommanual/PAYE11010.htm#IDAOVO0B

I think they would need to call HMRC. As far as I am aware, even an NT code is used, tax still ultimately needs to be paid, it just isn't deducted at source.

Thanks for the info. I haven't come across a nil tax code before.