From April 2015, a new tax break is available to married couples and civil partners worth up to £212 a year.
The rules say that neither of them can pay higher rate tax. If one of them has no income, or income below £10,600, they can transfer up to £1,060 of their personal income tax allowance to their partner. The partner can set this against their taxable income and will pay less tax – £212 if the allowance transferred is £1,060. HMRC will start notifying those eligible shortly.
This scheme is the result of the Conservative party’s promise to ‘do something’ for married couples. It is a typical example of a politically inspired tax break which is unnecessarily complicated and not worth very much – the worst of all worlds. Even many Tory MPs are unimpressed.