The Marriage Allowance 2026/27: Professional Guide to the £252 Tax Saving

As of 19 June 2026, the Marriage Allowance remains a valuable tax relief for eligible couples. This guide provides a detailed breakdown of its mechanics, eligibility criteria for the 2026/27 tax year, and key considerations for client advice, including backdating and claims involving deceased partners.

What is the Marriage Allowance?

The Marriage Allowance is a tax relief introduced in 2015 that allows an individual to transfer 10% of their unused Personal Allowance to their spouse or civil partner. It is designed to benefit couples where one partner has an income below the Personal Allowance and the other is a basic rate taxpayer. The underlying legislation for this allowance is found in sections 55A to 55E of the Income Tax Act 2007 (ITA 2007).

For the 2026/27 tax year, the key figures are:

• Personal Allowance: £12,570
• Amount Transferable: £1,260 (10% of £12,570)
• Maximum Tax Reduction: £252 (£1,260 at the 20% basic rate)

The recipient partner receives a tax credit, which reduces their income tax liability. The credit is limited to the amount of tax they would otherwise pay.

Eligibility Criteria for 2026/27

For a couple to be eligible for the Marriage Allowance, they must meet the following conditions:

It is crucial not to confuse the Marriage Allowance with the Married Couple’s Allowance. The latter is a separate relief available only to couples where at least one spouse or civil partner was born before 6 April 1935.

Practical Mechanics: How the Claim Affects Tax Codes

When a successful claim is made, HMRC adjusts the PAYE tax codes for both partners to reflect the transfer.

• The Transferor: Their Personal Allowance is reduced by £1,260 (from £12,570 to £11,310). Their tax code is often amended with an ‘N’ suffix.
• The Recipient: They do not see their Personal Allowance increase directly. Instead, they receive a tax credit worth £252. Their tax code is often amended with an ‘M’ suffix.

This mechanism ensures the benefit is delivered as a straightforward reduction in the recipient’s tax bill.

Backdating Claims: Unlocking Past Savings

A significant feature of the Marriage Allowance is the ability to backdate claims for up to four previous tax years. This means that in the 2026/27 tax year, an eligible couple can claim for:

• 2022/23
• 2023/24
• 2024/25
• 2025/26

A successful backdated claim for all four years, in addition to the current year’s claim, can result in a total tax saving of up to £1,260 (5 x £252).

Important Considerations: Deceased Partners and Future Changes

Claims Involving a Deceased Partner

Legislation introduced on 29 November 2017 enables claims to be made on behalf of a deceased spouse or civil partner. This allows the surviving partner to claim the allowance for tax years in which the entitlement conditions were met before their partner’s death. These claims can also be backdated for up to four years.

Additionally, where an election for Marriage Allowance is in place, and the recipient dies, the transferor’s Personal Allowance is automatically reinstated to the full amount for the year of death.

Future Legislative Changes

Professionals should be aware of forthcoming amendments to the governing legislation:

1. Domicile Rules (Finance Act 2025): The exemption for individuals not domiciled in the UK is being repealed. This will affect section 55C of ITA 2007, which governs the election to transfer the allowance.
2. Property Income (Finance Act 2026): The rules will be amended to incorporate the “property basic rate” and “Welsh property basic rate” into the eligibility conditions in sections 55B and 55C of ITA 2007, ensuring that individuals with significant property income taxed at these rates are correctly assessed for eligibility.

To further advise on this topic, you may wish to review the precise wording of sections 55A to 55E of the Income Tax Act 2007 and refer to HMRC’s latest guidance on making claims, particularly in complex cases such as those involving deceased estates.