Warning for married couples who may be owed a lump sum payment worth £1,200

MILLIONS of married couples are being urged to check whether they owe a lump sum of more than £1,200.

The marriage allowance allows married couples or civil partners to share their personal tax deductions.

Couples could be owed a lump sum worth more than £1,200

HMRC has revealed that March is the most popular month for marriage benefit claims, with almost 70,000 couples claiming in March last year

Marriage tax relief allows couples to claim money back if one half earns less than £50,270 a year and the other half earns less than £12,570 or no money at all.

So if you or your partner have not used up your personal allowance (currently € 12,570 per year), you can transfer it to the other.

This means they can save up to €252 in the current tax year. In addition, you can backdate any claims for up to four years if you were previously eligible – a total saving of €1,260.

Angela MacDonald, deputy chief executive and second permanent secretary of HMRC, said: ‘Marriage Allowance keeps money in your pocket by reducing the amount of tax you and your spouse pay by up to £252 per year.

If you’re not sure whether you qualify, HMRC has an online marriage benefit calculator that can help you check this.

And the great thing is: it only takes 30 seconds to complete.

HMRC said couples who may not be aware they can claim include couples where one partner works and the other has an income of less than £12,570, including couples who:

are retired
have given up work to care for children or elderly relatives
are unable to work due to long-term health problems
have a part-time job
have a low-paid job

To file your claim online, you will need both social security numbers, plus some proof of identity.

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Another tax break that could give couples a cash boost

One way couples can save some money is by maximizing their personal savings allowance.

If one half of a couple has reached the tax-free income limit and the other half has not, you can transfer your savings and use up the remaining Personal Savings Allowance (PSA).

PSA is the total amount of interest you can earn on all your bank accounts, minus ISAs, without paying tax.

Under the deduction, basic rate taxpayers, those with an annual income between £12,571 and £50,270, can earn £1,000 in savings income before having to pay tax on it.

Meanwhile, higher rate taxpayers, those earning between £50,271 and £125,140, will receive a £500 compensation.

If your partner has not reached the tax-free limit, you can easily transfer the savings from one bank to another.

However, we spoke to tax expert Laura Suter who has a word of caution if you’re thinking about doing this.

We have the full list of tax benefits for couples, including survivor benefits and inheritance taxes.

Meanwhile, a mother demanded £250 back when she realized she was eligible for the cash boost.

Who is eligible for marriage benefit?

You can claim marriage benefit if one of the following situations applies

You are married or have a registered partnership
You currently pay no income tax or your income is less than your personal allowance (usually £12,670)
Your partner pays income tax at the basic rate, which usually means their income is between £12,571 and £50,270 before they receive spousal allowance.

Please also note that you cannot claim marriage benefit if you live together without being married or have a registered partnership.

Claims for the spousal benefit can be made retroactively to include any tax year for which you were eligible since April 5, 2018.

Your partner’s tax bill will be reduced depending on the personal deduction rate for the years you go back.

You can apply for marriage benefit by completing a form on the government website.

You can also apply via self-assessment or by writing to HMRC.