Widows or widowers can now claim up to £662 in backdated marriage tax allowance, it emerged in the Autumn Budget today.
Detail buried in the Budget papers reveals that if you and your spouse were eligible for marriage tax allowance at any time from April 2015 but you didn't claim before the death of your partner, you can apply from Wednesday 29 November. Previously people could make backdated claims, but not if their spouse had died.
The marriage tax allowance allows a spouse or civil partner to transfer a tenth of their personal allowance (the amount you can earn tax-free each tax year) to their income tax-paying partner.
For more information on how to claim, see our Marriage Tax Allowance guide.
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Who can claim?
If you fit the following criteria, you can apply:
- You need to have been married or in a civil partnership.
- You both must have been born on or after 6 April 1935.
- One of you needs to have been a non-taxpayer in any or all of the 2015/16, 2016/17 or 2017/18 tax years. This usually just means earning less than the £11,500 personal allowance (£11,000 for 2016/17, £10,600 for 2015/16).
- The other needs to have been a basic 20% rate taxpayer (higher or additional-rate taxpayers aren't eligible for this allowance) in these tax years. This means you'd normally need to have earned less than £45,000 (£43,000 for 2016/17 or if you live in Scotland, £42,385 for 2015/16).
- Under the rules technically it's the non-taxpayer who gives up their allowance – so although you can still apply if you are the non-taxpayer, the money will go into the taxpayer's estate.
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How much will I get?
If you were a basic-rate taxpayer you'll get 10% of your partner's personal tax allowance transferred to you.
The maximum you could potentially claim would be £662 over three years, though the rebate will be lower if your partner was already using over 90% of their allowance.
If you were not eligible to claim the full £662 for all three tax years, the amount you can claim for each year is:
- £212 for 2015/16
- £220 for 2016/17
- £230 for 2017/18
In future, claims will be backdated up to four years, but marriage tax allowance was only introduced in April 2015 so it isn't possible to claim for tax years before that.
How do I apply?
You can apply online – if you have any difficulties, ring 0300 200 3300.