Tax Breaks for Married Couples

Plans for married couples to get tax breaks worth up to £200 a year have been announced by the Prime Minister.

David Cameron has said four million couples would benefit from a £1,000 transferable tax allowance from 2015.

The tax break would apply if couples are both basic rate tax payers with one spouse earning less than the personal allowance – the amount of income you can receive each year without having to pay tax on it. This will be just over £10,000 in 2015.  The measure would also include 15,000 couples in civil partnerships.

The basic tax rate of 20% is currently in place for up to £32,010 of taxable income. That means that – including a personal allowance – at current rates people would have to earn less than £41,451 a year to be eligible.  Benefits from the scheme would come through initially at the end of the tax year in 2016.

Mr Cameron said, “I believe in marriage. Alongside the birth of my children, my wedding was the happiest day of my life.  Since then, Samantha and I have been a team. Nothing I’ve done since – becoming a Member of Parliament, leader of my party or prime minister – would have been possible without her.

“There is something special about marriage: it’s a declaration of commitment, responsibility and stability that helps to bind families.  The values of marriage are give and take, support and sacrifice – values that we need more of in this country.  The £1000 marriage tax allowance will apply to straight and gay couples, as well as civil partners. Love is love, commitment is commitment.”

“From April 2015, if neither of you are higher rate taxpayers, you will be able to transfer £1,000 of your tax-free allowance to your spouse.  In effect, if you pay the basic rate of tax and your partner doesn’t use all of their personal allowance, you’ll be able to have some of it.  Most couples who benefit will be £200 a year better off as a result.”