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taxadvisor.uk
taxadvisor.uk, Chartered Certified Accountant
Category: Tax
Satisfied Customers: 5020
Experience:  FCCA - over 35 years experience as a qualified accountant (UK based Practitioner)
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How much income am i and my wife allowed we are both over seventy

Customer Question

how much income am i and my wife allowed we are both over seventy and all we have is our penstions
Submitted: 2 years ago.
Category: Tax
Expert:  taxadvisor.uk replied 2 years ago.
Hello and welcome to the site. Thank you for your question.

If you are born between 6 Apr 1938 and 5 Apr 1948 then your personal allowance is £10,600 i.e. the first £10,600 is tax free and the rest is taxed at 20%.

From 6 April 2015 it is possible for some couples to transfer 10% of the personal allowance between them. This is being called the ‘Marriage Allowance’. It is completely different from the Married Couple’s Allowance. (The Married Couple’s Allowance is a reduction in the tax bill which can be claimed by some couples aged 80 or over on 5 April 2015).


The conditions are:

- You are married or civil partners

- Neither you nor your partner pay tax at higher (40%) or additional (45%) rates

- You are under the age of 80 on 5 April 2015


The amount you transfer in 2015-16 is £1,060. That is 10% of the personal allowance of £10,600. The maximum tax saving is £212 in the year to 5 April 2016 (this is 20% x £1,060).


I hope this is helpful and answers your question.

If you have any other questions, please ask me before you rate my service – I’ll be happy to respond.