As the cost of living continues to rise and tax thresholds remain frozen until at least 2028, more households are facing higher tax bills than ever before. However, HMRC has a tax break that many eligible couples are missing out on—the Marriage Allowance. This scheme allows couples to transfer part of their tax-free Personal Allowance, increasing their household’s total tax-free income and reducing their overall tax burden.
What makes the Marriage Allowance particularly valuable is the ability to backdate claims for up to four years, meaning eligible couples could receive an instant rebate of up to £1,242. Despite these significant financial benefits, thousands of couples remain unaware of the scheme, leaving millions of pounds unclaimed. With tax burdens expected to rise in the coming years, now is the perfect time for couples to check their eligibility and apply before they miss out.
How Does the Marriage Allowance Work?
The Personal Allowance is the amount of income a person can earn before paying tax, currently set at £12,570 per year. However, the Marriage Allowance allows a lower-earning partner to transfer £1,260 of their Personal Allowance to their spouse or civil partner, effectively reducing the higher earner’s taxable income.
Explaining how the scheme works, the government states:
“Marriage Allowance lets you transfer £1,260 of your Personal Allowance to your husband, wife, or civil partner. This reduces their tax by up to £252 in the tax year (6 April to 5 April the next year).”
This means that couples who qualify for the scheme could save hundreds of pounds annually while also benefiting from a backdated lump sum payment.
HMRC provided an example of how the tax break works in practice:
*”When you claim Marriage Allowance, you transfer £1,260 of your Personal Allowance to your partner. Your Personal Allowance becomes £11,310, and your partner gets a ‘tax credit’ on £1,260 of their taxable income.
This means you will now pay tax on £190, but your partner will only pay tax on £6,170. As a couple, you benefit, as you are only paying Income Tax on £6,360 rather than £7,430, which saves you £214 in tax.”*
While savings vary depending on individual earnings, the maximum annual tax reduction is £252 per year, which can be claimed retroactively for up to four years.
Who Qualifies for This Tax Break?
Not all couples are eligible for the Marriage Allowance, but those who meet the following criteria can claim the tax relief:
- The couple must be married or in a civil partnership (unmarried couples are not eligible).
- One partner must earn less than £12,570 per year or have no income at all.
- The other partner must be a basic rate taxpayer, earning between £12,570 and £50,270 per year.
- Neither partner can be a higher or additional rate taxpayer.
For example, if one spouse stays at home while the other earns £30,000 per year, the lower-earning spouse can transfer £1,260 of their Personal Allowance, saving the working partner £252 in taxes annually. Over time, this can add up to thousands of pounds in savings.
Even couples who have never applied before can still claim the allowance for previous tax years, meaning they could receive a lump sum rebate from HMRC.
How Much Can You Claim?
Immediate Annual Savings
- Eligible couples can reduce their tax bill by £252 per year starting from the current tax year.
Backdated Claims for the Last Four Years
- Couples can also claim for the previous four tax years, meaning they could receive a lump sum rebate worth:
- £252 for 2023/24
- £252 for 2022/23
- £250 for 2021/22
- £238 for 2020/21
This brings the total possible rebate to £1,242, which will be paid directly to the couple in a tax refund from HMRC.
When combined with the standard £12,570 Personal Allowance, the total tax-free income for the household can rise to £14,064—a valuable financial boost for many families.
How to Apply for the Marriage Allowance
Claiming the Marriage Allowance is quick, free, and easy. Couples can apply:
- Online through the HMRC website using their Government Gateway login.
- By calling HMRC at 0300 200 3300 to request assistance.
- Via a paper application, available for those who prefer a postal submission.
Once approved, the allowance automatically renews each year, meaning couples don’t have to reapply unless their circumstances change.
HMRC processes backdated claims within 8-12 weeks, and any rebates will be paid directly into the couple’s bank account.
Why Couples Should Act Now
With tax thresholds frozen until 2028 and the cost of living continuing to rise, UK households need to maximize every available tax break. The Marriage Allowance provides a simple way for couples to reduce their tax bill while unlocking thousands of pounds in savings.
For couples who haven’t claimed before, the ability to backdate four years means they could receive an instant lump sum refund, easing financial strain and providing extra funds for household expenses.
Since many taxpayers are unaware of this benefit, thousands of eligible couples have yet to claim what they are owed. Checking eligibility takes minutes, and for those who qualify, applying could mean a significant financial boost without extra effort.
With millions in unclaimed tax relief still available, now is the perfect time for married couples to take advantage of this hidden tax-saving opportunity.
