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New married couples UK tax break

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There are more than 4 million married couples and 15,000 civil partnerships in the UK who would be eligible for the new tax break, which will be introduced from 6th April 2015.

If you are:

  • Married or in a civil partnership ;
  • You have an annual income of less than £10,600 including pensions, savings and investments;
  • Your spouse or civil partner has an annual income of between £10,601 and £42,385;
  • You were born on or after 06 Apr 1935;

You might be able to reduce your husband, wife or civil partner’s tax bill by up to £212.


How will it work:

Each individual is entitled to a personal allowance of £10,600 – this is the income you can receive tax free in 2014/15 tax year. However under the new married allowance rules it is possible to transfer up to £1,060 of your unused personal allowance to your spouse or civil partner

The average UK tax rebate is £963


Example 1:

Sarah and Mark are married and were both born in 1978.

Mark is in full-time employment and his annual salary and benefits (which represent his total income) amount to £41,000. He has a savings account generating annual interest of £350. His expected total income for the year is therefore £41,350.

Sarah is working part-time and her annual salary is £9,000. Her unused personal allowance in 2014/15 tax year will therefore be £9,000 - £10,600 = £1,600. The maximum married allowance she can transfer to her husband Mark is however £1,060.

Example 2:

Mike was born on 31 May 1986 and Emily was born on 22 Mar 1990. They got married in 2013. Mike has total income for the year of £42,000 and Emily is a student.

As Emily has not yet finished her master’s degree, she decided to move to a temporary employment contract from April 2015. Her annual salary will be £9,500. Her grandparents set up a few years ago an investment account which is generating gross dividends of £500 per year (received net of 10% notional tax credit).

Emily’s unused personal allowance in 2015/16 will therefore be £600. As that is less than the maximum allowance that can be transferred, all of it can be relocated to her husband Mike.


How to claim the allowance:

HMRC have now opened the registration process so you can express your interest on the matter at the following link:


Any individual that intends to transfer their unused 2014/15 allowance must submit the above registration. Once the process is completed, the recipient of the additional allowance will be notified through an updated PAYE coding notice.

If you would like to receive more information or you think you might be due a repayment of income tax for 2014/15 tax year or you are required to complete a UK self-assessment tax return, do not hesitate to contact our UK Client Relationship manager Lisa Quirke at lquirke@taxback.com  or the following UK phone numbers: 0808 2381 611 or 0207 6599 188

About The Author

Petya Petrova - UK Tax Team Lead @ Taxback.com

A tax certified technician (ATT), having the opportunity to attend my ATT ceremony in the UK Parliament's House of Lords. I am truly passionate about my work and always eager to hear from former or current colleagues, managers, or just interesting creative people, so feel free to contact me if you’d like to connect.

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