Couples can boost their tax-free allowance by £1,260 (Image: Getty)
Couples could be missing out on a simple tax break that can boost take-home pay by up to £1,260. The perk lets couples who earn substantially different amounts transfer their tax-free allowances between themselves.
One partner can transfer £1,260 of their unused tax-free personal allowance to boost the amount their spouse can earn tax-free, cutting their tax bill by up to £252 in a year. Because claims can be backdated by up to four years, some couples could receive a lump sum of £1,000 from the Government, in addition to £252 in tax relief in 2025-26.
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Who is eligible?
There are a few key conditions to the relief, which is called Marriage Tax Allowance. Claimants must be married or in a civil partnership. Couples who live together are not eligible.
It is designed for couples where one partner earns less than the standard personal allowance while the other pays tax at the basic rate.
In the 2025/26 tax year, the non-taxpaying partner must earn less than £12,570. To receive the full benefit of the scheme, their income needs to be £11,310 or less.
Meanwhile, the other partner must be a basic-rate taxpayer, meaning they earn under £50,270 (or £43,662 in Scotland). Those who pay higher or additional tax rates cannot claim the allowance.
Both partners must also have been born on or after April 6, 1935. If either were born earlier, a different tax benefit may apply instead.
How to claim
The quickest way to apply for Marriage Allowance is online, through the Government website. You fill in a form, and you’ll get an email confirming your application within 24 hours.
How it works
For example, if one spouse earns £6,000 per year through part-time work and their wife earns £40,000 per year, they are perfect candidates.
The lower-earning spouse can transfer the full £1,260 of that unused allowance to their wife. After the transfer, their effective tax-free allowance increases from £12,570 to £13,830.
This means they can earn £1,260 more before paying tax, which previously would have been subject to 20% tax, so they can keep £252 for themselves.
How the money gets paid
During the 2025-26 tax year, the higher-earner will pay less tax through their paycheck. HMRC will adjust both partners’ tax codes. The tax code will end with ‘M’ if you are receiving the allowance, and ‘N’ if you are transferring the allowance.
If you are backdating a claim, you will receive a lump sum by bank transfer or cheque. It can take around a month to receive this.