Where the couple are both basic rate taxpayers it will make no difference to their net income, but husbands paying the higher rate while the wife pays tax at basic rate, or is a non-taxpayer, should retain all the allowance.
If the wife is in the higher 40 per cent bracket while her husband is a basic rate taxpayer, there will be a saving of pounds 258 if she takes the whole allowance.
The election must be made on IR Form 18 (transferring the married couple's allowance) before 6 April to apply for the 1993-94 tax year, although couples marrying after that date can apply at any time. Confusingly, those over 65 or 75 who are entitled to the higher married age allowances ( pounds 2,465 and pounds 2,505) can divide or transfer only the basic pounds 1,720. It would clearly not be sensible for non-taxpaying wives to demand their share, and careful calculations should be made where one partner has an income around the level ( pounds 14,200) at which age allowance is lost.
Unfortunately, there is no sign of a concession that would be welcomed by all non-taxpayers - the ability to transfer any unused individual allowance to their partners.Reuse content