Marriage Allowance - Reducing take home to qualify

carrspaints

Hi. So my wife logged into the HMRC and applied for Marriage Allowance two days ago. She logged in this morning and clicked on the tab "Check or update your Marriage Allowance" -> "Check current or earlier Marriage Allowance claims". For the past 4 years claims, it seems the HMRC have turned down the requests. Next to each period, e.g. 2017-2018, it states Higher earner not eligible for Marriage Allowance. Given my pension contributions via salary sacrifice bring my taxable income well below £50k, I can't understand why HMRC have declined the application.

Does anyone know why my wife's application for Marriage Allowance may have been declined? Have I misunderstood how this works? Does the HMRC only consider your salary BEFORE any deductions? From what I have read, you should be able to qualify by reducing your taxable income via salary sacrifice. So long as that amount is below £50k. It seems not to be the case though, or HMRC may have made a mistake, which I don't think they do often. Thanks.

sheramber

Do you have any other income apart from salary , such as dividends etc.?

carrspaints

Hi. No, my salary is our only income.

carrspaints

Just an update for anyone else who may have a similar query. I called HMRC to check on this. Because I get a company vehicle, BIK is factored into my taxable income, they say. So even if I salary sacrifice 25% of my salary to a pension, which would bring my taxable income down to around £43.5k, the addition of vehicle BIK increases taxable income above the threshold. I recently received a new company car which has a much lower BIK (Hybrid EV as opposed to petrol/diesel), it seems my wife should qualify for the 2021-2022 period.