Millions of couples could be entitled to a £252 annual tax cut through the Marriage Allowance, yet many are failing to claim it. The scheme lets a partner who earns less than the £12,570 Personal Allowance transfer £1,260 of their unused allowance to their husband, wife or civil partner.
The transfer reduces the higher earner's tax bill by up to £252 a year, meaning more cash stays in the household. Money Saving Expert describes the allowance as a £1,260 tax break, and estimates that around two million qualifying couples are missing out.
How the Marriage Allowance works
The Personal Allowance is the annual income everyone can receive before paying income tax. For the 2025/26 tax year, that threshold stands at £12,570. Anyone earning below this amount pays no income tax and can pass on £1,260 of their allowance to their spouse if the spouse pays tax at the basic rate.
If the transfer is approved, the higher earner's tax code changes, reducing the amount of tax deducted from their pay or pension. The saving is automatic once claimed, and the allowance renews each year without the need to reapply.
Who is eligible?
To qualify, the lower earner must have an annual taxable income below £12,570. This includes earnings from jobs, pensions, and certain benefits. The higher earner must be a basic-rate taxpayer, meaning they earn more than the Personal Allowance but do not pay the higher rate of tax.
The recipient must be born after 5 April 1935, unless they receive Married Couple's Allowance, which is a separate scheme. Couples in civil partnerships are equally eligible. Even if one spouse earns a significantly higher income, the allowance still applies as long as the other spouse's income is below the threshold.
Experts urge people to check
Money Saving Expert's website says: "If you're married or in a Civil Partnership and under 90 years old, you may be entitled to a £1,260 tax break called the Marriage Tax Allowance – something around two million qualifying couples miss out on." The site adds: "It's easy to apply and take advantage of this tax break."
The financial guidance also highlights the potential to backdate claims. "Marriage Tax Allowance is worth up to £1,260. So that's £252 for this tax year, plus £1,000 for the four previous tax years (if you're eligible to backdate)," the advice reads.
How to apply
Applying is straightforward and can be done online via Gov.uk. The lower earner must make the claim, providing details such as the higher earner's National Insurance number and income information. Once processed, HMRC will amend the tax code for the remainder of the tax year.
Eligible couples who have never claimed can also apply for the allowance for past years, with claims potentially stretching back four years. This could result in a lump sum payment worth around £1,000 on top of the ongoing £252 annual saving.
Why so many miss out
A lack of awareness remains the biggest barrier, according to money experts. Eleanor Levy, from now:pensions, said: "Couples can benefit from the marriage allowance, especially if one spouse annually earns less than £12,570. More than two million eligible couples are thought to be missing out on this tax break; you can check via Gov.uk."
The £252 annual saving may seem modest, but for households on limited incomes it can make a real difference. With the cost-of-living continuing to stretch budgets, the allowance represents a simple, underused financial boost.
Experts recommend that all married couples and civil partners review their tax arrangements, particularly if one person is not employed or works part-time. A quick online check takes only minutes and could uncover a substantial refund for past years.
