Marriage Allowance

Consumerist

bjbyorkshire wrote: »

Hubby and I did the transfer for last year successfully, my tax code from a small pension was altered so I assume that I don't have to ask HMRC to do the transfer again this year? Is it automatically carried on from year to year?

It should be automatic. If your, or your hubby's, circumstances haven't changed then I suggest you try to apply again for this year to give HMRC a nudge.

Edit
Just a thought, but the code change this year will be quite small because the Personal Allowance has only increased by £400 - so a code change of only 40. The transferred allowance is 10% of the Personal Allowance so the recipient's code change will be only 4 for the Marriage Allowance.

If you applied after 5 April 2016, then the code change should have already been applied for this year (2016/17) and a refund of up to £212 received by the recipient for 2015/16.

bjbyorkshire

Thanks Consumerist, I can't remember exactly when hubby received his refund but will look on the bank statement tomorrow. So if he received it after 5th April 16 that is this year's. I think it came into being in the last financial year so this would be the second year for receipt of the allowance.
I will update tomorrow.

Thanks again.

Consumerist

bjbyorkshire wrote: »

Thanks Consumerist, I can't remember exactly when hubby received his refund but will look on the bank statement tomorrow. So if he received it after 5th April 16 that is this year's. I think it came into being in the last financial year so this would be the second year for receipt of the allowance.
I will update tomorrow.

Thanks again.

If your hubby has received a refund then it will have been for the year 2015/16. This year the allowance will be applied only through tax codes until the end of the financial year.

Dazed_and_confused

bjbyorkshire

If your hubby has not yet sent in his 2015:16 self assessment return (assuming this is what you mean by reference to his accounts) then it is unlikely he will have received a refund yet for 2015:16.

He could have got the benefit via his tax code if he has a job/pension as well as being self employed but that would be drip feed month by month not a lump sum direct from HMRC.

It is only when his accountant submits the tax return that HMRC will normally give him the benefit of the Marriage Allowance.

Accountants generally have got in a but of a pickle over this, see numerous threads on the 'Any Answers' part of Accountingweb.com

sheramber

milkyboy wrote: »

This allowance is incredibly annoying, me and my wife are both earning over the threshold but combined incomes are lower than the highest allowed for one of the earners, this isn't helping people worse off at all

The Marriage Allowance is not an extra allowance It is a transfer of unused allowances from one person of a couple to the other.

if you both pay tax then there are no unused allowances to transfer.

Why are you worse off?

If one person had your total income there would only be one set of personal allowances set off against it.
As the total income is split between both of you then there are two sets of personal allowances set off against it.

So , between you, you pay less tax than the one person who earned the total alone.

polymaff

sheramber wrote: »

The Marriage Allowance is not an extra allowance It is a transfer of unused allowances from one person of a couple to the other.

if you both pay tax then there are no unused allowances to transfer.

Why are you worse off?

He can posit a case where a couple have a higher joint income than he and his spouse and yet qualify for a benefit that he and his spouse don't

And, understandably, it rankles!

Don't feel picked upon, Milkyboy. The late Chancellor's road to hell is paved with good intentions. Many of us have been stung by the unintended outcomes of his cunning plans. :rotfl:

Puzzlefused

Hi, I hope someone can advise me whether my wife can transfer a portion of her unused allowance to me. I have been a higher rate tax payer for part of this financial year, but have now increased my salary sacrifice pension contributions to take me below the 40% threshold. At what point can can she transfer the allowance - as soon as I have a month where I only pay tax at 20%, the end of the tax year, or some other point?

Any advice appreciated!

sheramber

polymaff wrote: »

He can posit a case where a couple have a higher joint income than he and his spouse and yet qualify for a benefit that he and his spouse don't

And, understandably, it rankles!

Don't feel picked upon, Milkyboy. The late Chancellor's road to hell is paved with good intentions. Many of us have been stung by the unintended outcomes of his cunning plans. :rotfl:

But if one of the couple hd excess allowances available there would be less personal allowance and/or less basic rate band allowable against the other's income so they would be worse off in the end

4_Pete's_Sake

Last year the criteria appeared to be that the higher earner needed to be a basic rate taxpayer however this year to qualify the higher earner must have an income of no more than £43,000. My gross is above this but after my pension contributions it is about £41,500 meaning that I am still a basic rate tax payer. However HMRC have advised me that even though my company pension contributions bring me below th £43k for taxable income I still do not qualify me for the Marriage Allowance as my Gross income is above £43k. This seems to be very unfair. Perhaps this is an issue that Martin could raise with the DWP.

Dazed_and_confused

You must have misunderstood the HMRC because there own guidance is clear in that it is being a higher rate payer which counts, not your income level.

https://www.gov.uk/hmrc-internal-manuals/paye-manual/paye100060

Are HMRC aware of your pension contributions?

In any case why are you discussing this with HMRC? You, as the higher earner, cannot claim this allowance only the lower earner can apply and you receive the allowance once they have done this - just get your wife to apply