Financial advantages of saying ‘I do’.

A marriage or civil partnership can be a beautiful union of minds and hearts, but there’s no reason why it should end there. There can also be financial benefits to being with your partner. One of these is the Marriage Allowance. In the 2019-20 tax year, the Marriage Allowance lets you transfer up to £1,250 of your Personal Allowance to your partner, meaning a tax reduction of up to £250, as long as you meet a few requirements.

For the couple to benefit, they must be married or in a civil partnership. The lower earner must have an income of £12,500 or less, and the higher earner must sit in the basic rate tax bracket of between £12,500 and £50,000. It’s worth noting that in Scotland, the higher earner’s salary must be less than £43,430 as the thresholds for basic rate payers differ.

Lower earners can transfer their unused tax-free allowances to their spouse, with the higher earning partner receiving a tax credit equal to the amount of Personal Allowance that has been transferred. The good news doesn’t end there either as the Marriage Allowance can be backdated as far as 5th April 2015. This means that, if you are eligible, you could claim 2015-16’s £212 allowance, 2016-17’s allowance of £220 and 2017-18s allowance of £238 in this tax year, leaving you with some free cash for you and your partner to treat yourselves.

At the point of writing, if you’re currently receiving a pension or you live abroad, your application for the Marriage Allowance will not currently be affected, as long as you receive a Personal Allowance. However, if you or your partner were born before 6 April 1935, applying for the Married Couple’s Allowance might be more beneficial to you (you can’t claim both at once!).

You can check the Marriage Allowance eligibility criteria at https://www.gov.uk/marriage-allowance