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Do you apply for Marriage Allowance every year?

The website and the tax return say 'no', but the HMRC telephone agent says 'yes'.

Didn't find your answer?

I have spent yet another half hour on the phone to HMRC this morning. It is becoming a daily appointment at 8am for one reason or another! On the tax return, Marriage Allowance transfer tells you to say 'No' if it is already in place, but I have had three clients so far this year where this is no longer automatically updating. Where I am no longer preparing a tax return for the 'donor' I can't update this manually. The HMRC agent I spoke to insisted that you need to apply every year (she knows because she has been doing so herself for years), which has not been the case historically and is not what it says on GOV.UK https://www.gov.uk/marriage-allowance.

How are we agents supposed to deal with these types of situations? Either the system is not working correctly, or the website is giving false information. The HMRC agents are not properly trained yet insist that they know what they are doing when they obviously don't.

Written complaints on other issues have not achieved anything, so is there any point going via this route?

Replies (20)

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By Hometing
06th Jul 2022 10:43

My understanding is that if it's set up directly with HMRC by phone/online etc, then it's adjusted for via tax code and therefore, c/f each year.

If dealt with via SA, then you seem to need to make the election each year.

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Replying to Hometing:
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By LucyCharles
06th Jul 2022 10:53

As mentioned above, when setting up via SA, it has been carrying forward.

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Replying to LucyCharles:
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By gillybean04
06th Jul 2022 11:07

If it was carrying forward, it shouldn't have been.

"(3)Where an election is made after the end of the tax year to which it relates [F32or is made after the death of either of the spouses or civil partners], the election has effect for the tax year to which it relates only (and accordingly does not continue in force for subsequent tax years under subsection (2))."

As a tax return can only be submitted after the end of a tax year, I would take that to mean any election made by self assessment is valid only for the tax year the return relates to.

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By Paul Crowley
06th Jul 2022 11:21

You were talking to an idiot at HMRC
That is becoming the new normal

No idea what tax return you refer to but most SA paid for software carries this stuff forward. It has to, to get the tax calculation correct.
Are you using HMRC freeware?

Even when MA shown on the return, HMRC 'amend' the return to show the exact same tax, and the claim reason for ammendment is applying MA.
This happens regularly.

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Replying to Paul Crowley:
RLI
By lionofludesch
06th Jul 2022 11:44

Slightly different scenario but HMRC software rejects your MA entries if an election is already in place.

I did HMRC software returns for both Mrs Lion and myself this year and the transfer was made automatically.

On the other hand, an ex-client has had to get his wife to claim again because the MA doesn't show on his SA calculation.

It's a mess.

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Replying to lionofludesch:
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By LucyCharles
06th Jul 2022 11:59

Yes, I am aware of the 'rejection' scenario but also aware that even under those circumstances the transfer is still made. The rejection is only of your request, not the transfer itself.

HMRC have promised me a call back but I'm not holding my breath!

I am beginning to wonder if this may have anything to do with the rogue firms that set up to make these claims and in doing so registered the claimants as their own clients? I had quite a problem 'losing' some clients last year (we needed to re-authorise) but at least one company suddenly stopped offering their service in February! https://marriageallowancecheck.net/

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Replying to lionofludesch:
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By Michael Davies
07th Jul 2022 09:28

Absolutely.I have always found this bizarre.

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Replying to Paul Crowley:
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By LucyCharles
06th Jul 2022 11:43

Yes, I have been using the same HMRC software for years and the MA has always been brought forward and shown on the donor's return (whilst it is has been relevant and allowable) but does not show on the recipient tax return until after the 'amendment'. It just isn't happening this year, with no obvious change to the system.

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Replying to LucyCharles:
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By gillybean04
06th Jul 2022 11:51

Has a return (or information by any other means) ever been submitted to hmrc indicating the election ceased to be valid?

Was there, for instance, a return submitted incorrectly showing higher rate liability? Or something which would have the similar effect of cancelling any ongoing election (assuming there was one)?

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Replying to LucyCharles:
RLI
By lionofludesch
06th Jul 2022 12:12

LucyCharles wrote:

Yes, I have been using the same HMRC software for years and the MA has always been brought forward and shown on the donor's return (whilst it is has been relevant and allowable) but does not show on the recipient tax return until after the 'amendment'. It just isn't happening this year, with no obvious change to the system.

All I can say is that the return wouldn't allow me to make entries in the claim boxes but the £252 credit appeared on the tax calculation at step 6.

Yes - I got a paper notification a few days later. I've no idea why they do that but it's nice to know they agree.

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Replying to Paul Crowley:
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By gillybean04
06th Jul 2022 11:47

Interesting. With the mention of it being the tax return and previously submitting the spouse's return, I assumed Lucy meant the election carrying forward.

I overlooked that the return doesn't ask to carry forward the election or have any yes no questions.

Which raises the question is it the software that's not carrying forward the calculation adjustment, or did the software carry it forward to calculation but the hmrc calculation hasn't included it? Also, is a valid election in place for the tax year?

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By lionofludesch
06th Jul 2022 12:14

One of them hasn't popped over into higher rate by any chance?

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Replying to lionofludesch:
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By LucyCharles
06th Jul 2022 12:29

No, everything is still relevant and allowable.

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Morph
By kevinringer
08th Jul 2022 11:22

It depends how MA was applied for. If it was applied for on the SA Tax Return it is stand-alone for that year only. If it was applied for online or over the phone there is an option to make it perpetual.

Some taxpayers (especially the self-employed) have fluctuating income. The result is that with some clients, one year husband will surrender MA to wife but the following year it is wife with the income below the Personal Allowance so she surrenders to husband. Sometimes one half of the couple's self-employment income might fluctuate around the higher-rate threshold, so some years they might not qualify. Perpetual claims don't work for these cases, so I claim annually on the Tax Return. I don't have many SA clients who have perpetual claims. In contrast, most clients who are only in PAYE only do have perpetual claims.

Word of warning: ever since MA was introduced, HMRC have had a bug in their software that prevents the Tax Return for a MA recipient being captured automatically. HMRC have to put these on manual work lists for manual capture. These can take months to be captured. I've still got some uncaptured cases from 2021.

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Replying to kevinringer:
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By lionofludesch
08th Jul 2022 11:31

kevinringer wrote:

It depends how MA was applied for. If it was applied for on the SA Tax Return it is stand-alone for that year only. If it was applied for online or over the phone there is an option to make it perpetual.

That's not the experience of Mrs Lion and myself.

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Replying to lionofludesch:
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By LucyCharles
08th Jul 2022 11:39

I agree, this is not the way things have worked for my clients either.

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Replying to lionofludesch:
Morph
By kevinringer
08th Jul 2022 12:44

I note your earlier comment about using HMRC software. I use third party software for all my clients with MA claims. There is no rejection if the MA is claimed on the Tax Return even if there is a perpetual MA claim in place.

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Replying to kevinringer:
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By lionofludesch
08th Jul 2022 12:57

kevinringer wrote:

I note your earlier comment about using HMRC software. I use third party software for all my clients with MA claims. There is no rejection if the MA is claimed on the Tax Return even if there is a perpetual MA claim in place.

Aye, happen so. But it's only this year that I've gone back to HMRC software, Kevin.

I haven't had a problem. Our MA claim was applied - despite being told that, in a needlessly brusque manner imho, that we should have said "No" when asked if we wanted to make a claim for MA.

But an ex-client has had a problem. He was similarly told, when completing his return, that a claim was already in place. Has he got his £252 ? No, he has not.

I say again - it's a mess.

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Replying to lionofludesch:
Morph
By kevinringer
08th Jul 2022 13:12

lionofludesch wrote:

I say again - it's a mess.


You're not wrong there, and the mess is not confined to MA: it is everything HMRC touches.
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Replying to kevinringer:
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By LucyCharles
08th Jul 2022 13:22

Oh, how I do agree!

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