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taxadvisor.uk, Chartered Certified Accountant
Category: Tax
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Experience:  FCCA - over 35 years experience as a qualified accountant (UK based Practitioner)
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My wife was born in 1931 (i was born 1940). She has a small

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My wife was born in 1931 (i was born 1940). She has a small pension of approx £4500pa.
Am I right in assuming that this is ofset by her personal allowance, and I can therefore claim my own personal allowance and also her married persons allowance of £9600. Although I assume I should not claim my married persons allowance as again I assume that ther is only one married persons allowance per couple?
Submitted: 2 years ago.
Category: Tax
Expert:  taxadvisor.uk replied 2 years ago.

Hello and welcome to the site. Thank you for your question.

All taxpayers are entitled to a personal allowance in their own right. You are right in assuming that your wife will have her personal allowance to cover her small pension of approx £4,500 pa.

You would claim your own personal allowance against your income. You would be entitled to married couple's allowance.

Taxpayers who are part of a couple, one of whom was born before 6 April 1935 are entitled to the married couple’s allowance. The married couples allowance is £8,355 in 2015-16 (2014-15, £8,165), but relief is only available at a rate of 10%. Therefore, the maximum reduction to your tax as a result of receiving the allowance is £835.50 (£816.50 in 2015-16).

More information on married couple's allowance can be found here

http://taxaid.org.uk/guides/information/rental-income-savings-income-and-pensioner-issues/pensioners/paye-and-the-married-couples-allowance

Furthermore, in 2015-16, married couples and civil partners will be able to share some of their personal allowance between them for the first time. Unused allowance from one partner can be used by a higher-earning second partner to save tax. The amount you can transfer is capped at £1,060 in 2015-16. Mr Osborne noted that this will increase to £1,100 by 2017-18. Only couples who are both 20% taxpayers can transfer allowance in this way.

I hope this is helpful and answers your question.

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