How does Marriage Allowance work and how do I transfer £1,260 to my spouse?

Marriage Allowance lets you transfer £1,260 of your Personal Allowance to your husband, wife, or civil partner. This can reduce their tax by up to £252 per year in the 2024/25 tax year.

Who is eligible?

To qualify for Marriage Allowance, all of the following must apply:

• You are married or in a civil partnership.
• The lower earner must have income below the Personal Allowance of £12,570 (or at least £1,260 below it).
• The higher earner must be a basic rate taxpayer, meaning their income is between £12,571 and £50,270.

The higher earner cannot be a higher rate (40%) or additional rate (45%) taxpayer.

How to apply:

• Apply online at GOV.UK. The lower earner is the one who applies to transfer their allowance.
• You can backdate the claim for up to 4 previous tax years, potentially receiving a refund of up to £1,242 for all years combined.
• Once registered, the transfer applies automatically each year until you cancel it.

What happens to each person's allowance?

• The lower earner's Personal Allowance reduces from £12,570 to £11,310.
• The higher earner's Personal Allowance increases from £12,570 to £13,830.

Important notes:

• If you separate or divorce, you should cancel Marriage Allowance.
• If the higher earner's income rises above the basic rate threshold, you may need to cancel to avoid a tax bill.
• Marriage Allowance is different from Married Couple's Allowance, which is only for couples where one partner was born before 6 April 1935.