Surplus to Requirements?

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Surplus Marriage Allowance

This may become a Frequently Asked Question. This is the gist of a support query we recently received:

- the client is a basic rate taxpayer

- spouse earns £9621 per annum, so £979 of her personal allowance remains unused

The rules say that she can transfer ‘up to’ £1060 of her allowance as marriage allowance. But in this case only £979 is available.

The client was looking for a means to transfer the reduced figure in our software but this is not possible because the allowance is all or nothing, i.e. 10% of the person allowance. This year the figure is fixed at £1060 and the transfer is dependant only on the transferor being below the annual PA threshold.

This is how this particular case works out:

Spouse A has paid no tax on earnings of £9621

£1060 allowance is transferred so they then have a liability of £1060 - £979 = £81 @ 20% = £16.20

Assuming Spouse B has paid sufficient basic rate tax he will get an additional allowance of a maximum £212.00

QED as my old maths master used to say.

Have fun people!

About ANDREW MANN

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