The Personal Allowance—the amount of income you can earn tax-free—has been frozen at £12,570 for several years, and is expected to remain at this level until at least 2028.
This government freeze, combined with rising inflation and wage growth, has led to what’s called fiscal drag—pushing more and more people into higher tax brackets without changing the actual thresholds.
But while most people are stuck with the same allowance, some UK households could legally increase their tax-free threshold to £13,830 using a little-known HMRC rule.
This is possible through the Marriage Allowance, which allows eligible couples to backdate their claims and increase their take-home pay significantly.
What Is the Tax-Free Personal Allowance?
The Personal Allowance is the amount of income you can earn before you start paying Income Tax. For the 2024/25 tax year, the standard Personal Allowance remains £12,570, and it applies to most taxpayers in the UK.
Tax rates on income above this threshold are as follows:
- 20% on income between £12,571 and £50,270
- 40% on income between £50,271 and £125,140
- 45% on income above £125,140
Unfortunately, with the threshold frozen, more people are falling into taxable brackets as wages rise with inflation. But there is one exception: couples who are married or in a civil partnership.
The Marriage Allowance Boost Explained
Under the Marriage Allowance, one partner can transfer up to £1,260 of their unused Personal Allowance to their spouse or civil partner—only if the recipient is a basic-rate taxpayer (earning between £12,570 and £50,270) and the transferor earns less than £12,570.
How Much Can You Save?
You could receive up to £252 per year through Marriage Allowance (20% of £1,260). But if you backdate your claim for up to four years, you may receive a lump-sum rebate of up to £1,260.
When you add this transfer to your Personal Allowance for the year, it effectively increases your tax-free income to £13,830:
| Year | Tax-Free Personal Allowance | Marriage Allowance Benefit | Total Tax-Free Income |
|---|---|---|---|
| 2024–25 | £12,570 | £1,260 | £13,830 |
| Backdate Total | £12,570 x 4 years | £252 x 4 = £1,008 | £1,260 rebate total |
Who Is Eligible for the Marriage Allowance?
To qualify for this tax-free allowance increase, the following conditions must be met:
- You are married or in a civil partnership.
- One partner earns less than £12,570 or is not working.
- The other partner earns between £12,570 and £50,270 (basic-rate taxpayer).
- Both individuals were born on or after 6 April 1935 (those born before may be eligible for Married Couple’s Allowance instead).
This could include:
- Stay-at-home parents
- Retirees with low pensions
- Individuals on a career break or unemployed
- Part-time workers earning below the tax threshold
New for 2024–25:
If you earn between £11,130 and £12,570, you can still transfer part of your allowance, although your earnings in that band will still be taxable. The savings will be smaller, but still worth claiming.
How to Claim the Allowance and Backdate It
Applying for Marriage Allowance is free and can be done online through the HMRC portal. Here’s what you need to do:
- Visit HMRC’s Marriage Allowance webpage
- Submit an application in the name of the lower earner
- Provide national insurance numbers and earnings details for both partners
- Choose to backdate your claim up to 4 previous tax years (from 2021–22 to 2024–25)
- Wait for HMRC to update your tax code or process your refund
Refunds are generally issued as lump sums for backdated claims, either by cheque or directly into your bank account.
Example: How It Works in Real Life
Let’s say Sarah and Mark are a married couple:
- Sarah earns £10,000 (no tax due)
- Mark earns £30,000 (basic rate)
Sarah can transfer £1,260 of her unused allowance to Mark. This reduces Mark’s taxable income from £30,000 to £28,740, saving them £252 in tax.
If they’ve never claimed this before, they can backdate it to 2021–22 and claim a total of £1,260 in tax savings.
With the Personal Allowance frozen until at least 2028, smart financial planning has never been more important. If you’re married or in a civil partnership and meet the income requirements, claiming the Marriage Allowance could increase your tax-free income to £13,830 and provide a cash rebate of up to £1,260.
Don’t miss this opportunity—check your eligibility and apply today to boost your household finances.
FAQs
Can I still apply if we missed claiming Marriage Allowance in previous years?
Yes! You can backdate your claim for up to four tax years, potentially receiving a lump-sum rebate worth up to £1,260.
Do we both need to file separately or does one partner apply?
Only the lower-earning partner needs to apply, and they will request to transfer their allowance to their spouse.
What happens if our income changes in the future?
You can cancel the Marriage Allowance at any time. If either partner becomes ineligible due to rising income or separation, you must notify HMRC.