If you’re a couple, where one of you pays basic rate tax and one pays no tax, you may be able to share some of the non-tax payer’s annual personal tax allowance.
Currently the personal tax allowance is £10,000 – rising to £10,600 in April this year. When the new scheme kicks in, if you earn less than £10,601 (which includes income from work, pensions and savings) and you don’t use your whole allowance, you’ll be able to transfer up to £1,060 of your unused tax allowance to your spouse or civil partner, providing they are a basic rate tax payer (between £10,601 and £42,385 from April this year).
Also, both of you must have been born on or after 6th April 1935. If one of you was born before that date, you can claim the married couple’s allowance.
The effect, if you are able to share the whole £1,060 amount with your partner, will be to increase their tax free allowance (their tax code will change), saving them 20% tax, which is £212 a year.
In order to benefit from the scheme, you need to register your interest at here
Unfortunately cohabiting couples aren’t able to take advantage of the allowance.
