Can I Transfer My Personal Allowance?

The long question is: Can I transfer my personal allowance to my husband/wife/civil partner if I am not using it?

Well from April 2015 the answer is yes, you can transfer part of it. So, if you are earning less than the personal allowance in 2015/16 and your partner (i.e. wife/husband/civil partner) has earnings that are not taxed at any higher than the 20% rate, then you can transfer part of your personal allowance to them – currently the amount that you can transfer is £1,060.

This would mean that they would have a personal allowance of £11,660 instead of £10,600, reducing their tax bill by £212 for the year and your personal allowance would be £9,540. Therefore if you earn less than £9,540 a year then it is a no-brainer to transfer this allowance over to your partner.

However, your partner must not be in the higher rate tax bracket for the transfer to be allowed.

Also, HMRC have not yet declared how this transfer will take place although they have indicated that it will be via an online submission.

This may help families in particular where there is the traditional model of one parent staying at home to look after the children and the other working.

The standard level of income that you would need to earn to fall into the 40% tax bracket is £42,385. Of course this may be different in certain circumstances so you should take advice for your personal situation. So it is possible if you earn below this and your partner earns less than £9,540 then it is worthwhile for you to transfer over the portion of the personal allowance. OK so a gain of £212 a year is not massive but it’s certainly worth having.

Edited to add on 20 Feb 2015: you can register your interest in transferring part of your allowance here:


Pensioners Could Earn £15,600 Tax Free

iStockbsheetFirstly I need to clarify the title of this article – this doesn’t only apply to pensioners but I wanted to highlight them as the most likely to benefit from this change in the tax rules that will start on 6 April 2015. Everyone can benefit, but it is more likely going to be pensioners that will have higher levels of savings income when compared to earned income (which includes pensions). Continue reading Pensioners Could Earn £15,600 Tax Free