MARTIN Lewis has issued a warning to two million married Brits who could be missing out on a tax break of more than £1,000 from the Government.
The money-saving expert says couples who have tied the knot may be entitled to claim up to £1,260, but many have yet to apply.
He flagged an expensive oversight affecting couples across the UK who are unaware of the Marriage Tax Allowance.
The little-known scheme allows eligible married partners to reduce their tax bill by transferring part of one partner’s Personal Allowance to their significant other.
Speaking on The Martin Lewis Money Show, Lewis explained that if one partner earns below the Personal Allowance threshold – usually £12,570 – they can transfer £1,260 of that allowance to their spouse or civil partner.
To qualify, one spouse must earn under £12,570, while the other must be a basic-rate taxpayer earning no more than £50,270.
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The finance guru explained: “The key part of this is one of you needs to be a non-taxpayer.”
Salaries and pensions both count, meaning retired couples can also benefit.
When couples are eligible for the money-saving trick, the non-taxpayer’s allowance is reduced to £11,310, while the taxpayer’s threshold increases to £13,830.
Lewis explained that by taking advantage of this, “the gain there is £252 a year.”
Couples are urged to check their eligibility before April because they may be able to backdate their claim for up to four tax years – potentially landing a windfall of up to £1,260.
Lewis stressed that it must be the non-taxpayer who makes the application.
“They have to apply to give someone their Personal Allowance,” he explained, as you cannot apply to take it.
But there is a warning. Lewis says some non-taxpayers earning between £11,310 and £12,570 could end up slightly worse off due to the way tax is calculated – so it’s important to check the numbers carefully before opting in.