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Keeping on top of money matters are no doubt a priority for many, however the busy nature of everyday life can mean this is somewhat of a challenge. Fortunately, Money Saving Expert founder Martin Lewis is regularly on hand to offer financial tips and suggestions to members of the public.
Today, he appeared on the ITV show Lorraine this morning, where he reminded couples they may be able to apply for Marriage Allowance.
However, there are stringent rules regarding this – in that common law partnerships do not qualify.
He said: “This applies to anyone who is married or in a civil partnership. It doesn’t doesn’t apply if you’re just cohabiting with somebody.”
Martin went on to explain those eligible may be able to get a tax break, depending on which tax band the members of the couple fit into.
“With this one you have to have been born after the 6th of April 1935 but what it effectively does is says if in your marriage one of you is a non-taxpayer and one of you is a basic 20 percent rate taxpayer, the non-taxpayer can apply to shift 10 percent of their Personal Allowance to the taxpayer.”
The Personal Allowance is the threshold of how much a person can earn per tax year prior to paying Income Tax.
Annual taxable income above the Personal Allowance up to £50,000 is subject to the basic tax rate of 20 percent.
Any taxable income above £50,000 will either be subject to the higher rate or additional rate of tax, depending on how much it is.
The standard Personal Allowance is currently £12,500.
“Your Personal Allowance is the amount of money you can earn without paying tax on it,” said Martin.
“This year, 10 percent of that is £1,250.”
Martin went on to explain that it meant couples could potentially make a saving of £250 between them this tax year via the Marriage Allowance.
“And, as it can be backdated for four years, if you were eligible, in total, there are people out there getting cheques for up to £1,188 – and this could come really quickly.
“Many people will get this money before Christmas if they apply now,” he suggested.
Worryingly, according to Martin, many people are eligible yet currently not claiming the tax break.
He warned: “There are hundreds of thousands of eligible people missing out.
Lorraine airs weekdays on ITV from 9am.
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