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Where Taxpayers and Advisers Meet

Marriage Allowance Transfer

njb55rtd
Posts: 5
Joined: Thu Apr 01, 2010 9:42 am

Marriage Allowance Transfer

Postby njb55rtd » Sat May 07, 2016 11:41 am

In respect of higher rate tax, for the 2015/16 tax year, people with the standard Personal Allowance started paying this rate on income over £42,385. (wording taken from HMRC web site).
Does this mean that, if you took the £1060 new surplus marriage allowance, it would extend this band to £43,445?
Nick

robbob
Posts: 2842
Joined: Wed Aug 06, 2008 4:01 pm

Re: Marriage Allowance Transfer

Postby robbob » Sat May 07, 2016 12:27 pm

Does this mean that, if you took the £1060 new surplus marriage allowance, it would extend this band to £43,445?
Interesting question in some respects




I guess this is the bit that specifically scuppers the relief.
http://www.legislation.gov.uk/ukpga/201 ... 11/enacted
(2)A tax reduction under this Chapter is given effect at Step 6 of the calculation in section 23
Basically it looks tax is calculated as normal including 40% as appropriate then relief is granted via a later step, as you have failed the test earlier in the calculation by being charged higher rate tax no relief is available, i have proof checked this with my software package and this removed the £212.00 tax relief as soon as the income exceeds 42385.

I would imagine this is presumably what you were expecting unfortunately.

Note you do have the option of paying into a pension or charity to get your income below the higher rate threshold - if you do self assessment and have not yet submitted it a gift aid donation could be made now and carried back to last year, may be handy if you are like £3 into higher rate and also good for the needy recipient - unless they only receive £3.20 :)


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