How Does Marriage Affect Your Taxes in Britain

Marriage is one thing every single tax payer wants to use as a tool to reduce their tax burden. In the UK as a married couple you have the opportunity to enjoy the tax amelioration principle that is granted to couple known as Marriage Allowance.

To show the significance of marriage on your taxes especially in the UK, partners who were born before 6th of April, 1935 are also being remembered to even have a whopping tax allowance that up to the sum of 300 Euro annually.

The identified categories are not the only ones that can benefit from the Marriage Allowance, a summary of marriage cases that benefit from the Marriage allowance in the UK are as follows:

  1. You are married or in a civil partnership
  2. Living with your spouse or civil partner
  3. And the above state category, that is, if you were born before 6th April, 1935.

For the third category, the income of the male partner is used as the taxable income, but for the other two categories, the income of the highest earner is used to settle out tax liabilities.

For couples born beyond the prescribe date, they can benefit from the Married Couple’s Allowance.

Standard Taxable Amount in UK

Band Taxable income Tax rate
Personal Allowance Up to £11,500 0%
Basic rate £11,501 to £45,000 20%
Higher rate £45,001 to £150,000 40%
Additional rate over £150,000 45%

The above table is the standard taxable amount in the UK regardless of your status. If you want to enjoy tax havens there are two options either the Marriage Allowance of the Married Couple Allowance

Pros of the Married Couple Allowance

  • Tax cut up to 326 and 844.50 Euro per year.
  • Transfer of the allowance to spouse or civil partner
  • In occurrence of death, the allowance continues for the living partner through the rest of that year
  • When partners are separate by other circumstance rather than a willful separation, each separated partner can still claim the Married Couple Allowance.
  • Capital gains and tax free gifts

Cons of the Married Couple Allowance

  • Totally nullifies existing will prior to becoming a couple
  • Does not affect your credit history.

Other things to note when filling the change in Tax status form

Once you have become married, you will want to enjoy the Married Couple Allowance, you should note the followings:

  • It is not automatic, hence you need to show interest by applying
  • Application deadline every year is 31st January, once the deadline elapsed you will be billed for your existing tax category and failure to remit in your existing category attracts fine
  • In filling the tax form, you need to provide details of your P60 (which is your taxable income eligibility, that is you earn more than 8,500 Euro), and your P11D (details of expenses and benefits).
  • You will need to provide information regarding interest statements from banks and building societies; gifts and donations etc.
  • The tax form is obtainable online from the HMRC’s website, and it is rigid in a way that you can hardly accept error.
  • If you don’t have much information regarding your P60 and P11D do not worry just ensure you read very well the, HMRC’s system is so intelligent that it suggests to you almost all possible places where such information is available for your use.

If you need further help during your filing, you may contact get any help regarding the form from Gov.uk/self-assessment-tax-returns. Additionally, you can also call the helpline on (0300) 200 3310.