Martin Lewis, has shared how two million couples could be eligible for £1,006 before Christmas.
This tax perk allows the lower earner in a relationship to transfer £1,260 of their personal allowance to their partner, potentially saving hundreds of pounds.
In the latest Money Saving Expert (MSE) newsletter, Lewis explained that over two million couples could claim the Marriage Tax Allowance and potentially receive a cheque for up to £1,006.
It stated: “Get a cheque for up to £1,006 when you claim the Marriage Tax Allowance.
“Claiming tax allowances isn’t traditional fare, but it is a quick way for two million eligible couples not currently claiming to get an up to £1,260 tax refund – for many this will include a cheque for over £1,000.”
To be eligible, claimants need to first be married or in a civil partnership.
Couples can apply online through the HMRC website or by calling 0300 200 3300
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Then, one partner needs to be a non-taxpayer, earning under £12,570 a year. The other must be a basic rate taxpayer, earning between £12,570 and £50,270 (or £43,662 in Scotland).
Lewis said: “If eligible, the non-taxpayer can transfer 10 per cent of the amount they can earn tax-free each year to the taxpayer, so they pay less tax.
“Better still, this can be backdated for up to four years if you were eligible then.”
This tax perk allows the lower earner in a relationship to transfer £1,260 of their personal allowance to their partner, potentially saving hundreds of pounds.
This transfer reduces the non-taxpayer’s personal allowance to £11,310 and increases the taxpayer’s to £13,830.
The allowance is worth £252 for the current tax year. However, claims can be backdated for up to four years if couples were eligible during that time.
Couples can apply online through the HMRC website or by calling 0300 200 3300. HMRC offers an online tool that takes “only 30 seconds” to check eligibility.
Applicants will need their National Insurance number and ID at hand.
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Once they have claimed it, the allowance will automatically apply for future tax years, as long as eligibility criteria are still met.
Lewis said: “For this year’s allowance, worth £252, the taxpayer’s tax code is changed, so they pay less tax during the year.
“However, if you’re eligible for backdating, worth up to £1,006, that’s paid as a cheque or bank transfer taking around six weeks, so you could have it by early December.”
When applying, Lewis warned against using unofficial websites.
He said: “Beware googling ‘marriage tax allowance’. Some shyster firms will charge you for applying (they try to look official), but it’s FREE to apply.”
He encouraged eligible couples to act promptly.
With the application process taking about six weeks, those who apply soon could receive their cheque by early December.