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What is the transferable tax allowance (marriage allowance)?

An individual can elect to transfer 10% of the personal allowance to the spouse or civil partner where neither party is a higher rate or additional rate taxpayer. The legislation calls this the ‘transferable tax allowance’ but the GOV.UK website refers to it as the ‘marriage allowance’. The personal allowance is frozen at £12,570 until 5 April 2028, and therefore the transferable tax allowance is similarly frozen at £1,260 for the same period (as it is rounded up to the nearest £10).

The transferor’s personal allowance is reduced by the amount transferred. Although, see ‘Transferable tax allowance where one of the couple has died’ below for the exception to this rule.

The transferee obtains income tax relief via a tax reduction of 20% of the transferred amount deducted at Step 6 of the transferee’s income tax computation.

Who benefits from the transferable tax allowance?

The transferable tax allowance is of benefit where one of the couple is not able to utilise the full