Cancelling Marriage Allowance

silvial

Hello everyone. I was stupid because I did not check how it really works and I’ve applied for the marriage allowance without even thinking that I could owe tax after. I was advised  that I would get some extra money if I applied. I’ve received letter that actually I owe for 2 different years and that’s around £550. 

I’m devastated.
 My question is, if I’ll cancel would HMRC cancel what I owed them now?

Flugelhorn

I doubt it - basically you haven't paid enough tax and they are pretty hot on that. They may add it to your PAYE code and it would get taken off gradually. 

Savvy_Sue

Flugelhorn said:

I doubt it - basically you haven't paid enough tax and they are pretty hot on that. They may add it to your PAYE code and it would get taken off gradually. 

But are they also offering the OP's spouse the tax from the Marriage Allowance?

sheramber

Marriage Allowance is not an extra allowance. One person transfers some of their allowances to  the other person.
So person A now has less tax free  allowances and person B has more.
if person A did not  need all these allowances then they are no worse off and person B  gains rom the extra allowances.
In your case person A  did not have unused allowances so  is now liable to the tax due on that amount income.
Per son B gets a tax  rebate  due to the increase in personal allowances.
So, as a couple  they are no worse and no better off.  
Before claiming the allowance you need to check if you will benefit. In your case it appears you do not. 

silvial

Thank you for all your answers. I know I should have check but I didn’t. 

Basically what’s happened is that I did not have enough personal allowance and did transferred to my husband who in those 2 years did not even need them because his earning was bellow his own personal allowance. I can’t believe I was so greedy and stupid. 

Anyway, is there anything that I could say in order to cancel the outstanding tax calculation due to mistakenly taken marriage allowance?

Flugelhorn

I get a bit confused about this - you are saying that you transferred the allowance to your husband when I think it should have been the other way round if he was not earning ?

silvial

Flugelhorn said:

I get a bit confused about this - you are saying that you transferred the allowance to your husband when I think it should have been the other way round if he was not earning ?

I thing I’ve got that wrong. I’ve just checked those years and his earning were just slightly above his personal allowance so he had paid like very little tax. My at the same time (same years were I owe tax) were also more than my personal allowance. To summarise, both of us had slightly more earnings than personal allowance.  

Flugelhorn

silvial said:

Flugelhorn said:

I get a bit confused about this - you are saying that you transferred the allowance to your husband when I think it should have been the other way round if he was not earning ?

I thing I’ve got that wrong. I’ve just checked those years and his earning were just slightly above his personal allowance so he had paid like very little tax. My at the same time (same years were I owe tax) were also more than my personal allowance. To summarise, both of us had slightly more earnings than personal allowance.  

So I don't think there was anything to transfer if you were both above the personal allowance level. Have you spoken to HMRC about paying this back - they aren't generous in "forgetting" what is owed to them but may spread out the underpayment 

silvial

Flugelhorn said:

So I don't think there was anything to transfer if you were both above the personal allowance level. Have you spoken to HMRC about paying this back - they aren't generous in "forgetting" what is owed to them but may spread out the underpayment 

Thanks for replying. 

I’ve phoned them yesterday (waiting 40 min due to COVID-19 :-), however I was on my own and the lady I’ve spoken to, she wants to check my husband details. So I have to phone them again when both of us will be available. 

She only said if I would call them before applying I would receive information if it would be beneficial for me. I said I was advised wrongly them. Then she asked by who. 

I don’t know what HMRC will do now. I don’t have big hopes. Let see. Will try to call them on Monday again. 

sheramber

So you husband  would get a  repayment of overpaid tax and you got a bill.
You will both het amended tax codes for the current year.
You can cancel the transfer  online https://www.gov.uk/marriage-allowance/if-your-circumstances-change
You used to be able  to cancel the transfer back to when it started by the person who got the allowancing   but that option does not appear on the current website.
You may wish to contact HMRC to check that. 
Phoning first thing when the phones open or a few minuted before   can be more successful than later in the day.