Can i give my husband unused tax allowance?

[nearly40]

I have been taxed seperately to my husband for years, last year i left work for a while and earned in total 17,000 in 2006.
I thought i could transfer some of my tax allowance to my husband, be taxed as a couple and he would get a refund on some of the amount he paid 43% on by using the balance of what i didn't use at 20%.
He rang the tax office and was told he was too late. Can this really be the case? i wasn't to know how much i earned until end of dec., have to ring back but was hoping someone could enlighten me first.
Thanks.

 

[ClubMan]

I have been taxed seperately to my husband for years, last year i left work for a while and earned in total 17,000 in 2006.

You would be better off being on joint/aggregated married taxation for any year in which one of you was on the high rate of tax and the other was on the low rate. Note that you can only backdate claims by 4 years max.

I thought i could transfer some of my tax allowance to my husband, be taxed as a couple and he would get a refund on some of the amount he paid 43% on by using the balance of what i didn't use at 20%.

You mean 42% (2006) and 41% (2007) I presume as the high rate has not been at 43% for a long time (if it ever was?).

He rang the tax office and was told he was too late. Can this really be the case?

I don't think so. I think that you should be able to backdate opting for joint/aggregated married taxation but maybe you can't.

i wasn't to know how much i earned until end of dec., have to ring back but was hoping someone could enlighten me first.

Just shows that even couples who are normally both in the top rate bracket might be better off in certain cases by opting for joint/aggregated married taxation or single married assessment but balancing things are year end. I still don't understand why couples would ever be better off opting for assessment as two single people.

 

[xeresod]

He rang the tax office and was told he was too late. Can this really be the case?

I don't think so. I think that you should be able to backdate opting for joint/aggregated married taxation but maybe you can't.

You need to notify Revenue by the 31st of March of the year you wish to start claiming joint assessment. From the Revenue website (leaflet IT2, taxation of married persons)...

The couple themselves elect which of them is to be the assessable spouse. A verbal nomination made by either spouse is acceptable. [See the Assessable Spouse Election Form, this form allows the nomination to be made.] While the nomination must be made to your local Revenue Office on or before 31st March in the tax year, it should ideally be made before the commencement of the tax year i.e. 1st January, to ensure that the correct tax credits and Standard Rate Cut-Off Point are allocated to each spouse from the commencement of the tax year.​

 

[ClubMan]

Thanks xeresod. Wasn't sure if there was a deadline for the married taxation declaration stuff.

 

[nearly40]

"I still don't understand why couples would ever be better off opting for assessment as two single people."

I never saw any advantage previously, just seemed more paperwork, it does seem that i'm too late though for 2006.
We are now both earning at the top rate , so is there any other advantage of being taxed as a couple?

 

[ClubMan]

We are now both earning at the top rate , so is there any other advantage of being taxed as a couple?

Probably not but also possibly still worth opting for joint/aggregated married assessment or separate married assessment instead of assessment as two single individuals in case your circumstances change in the future (e.g. like last year). See [broken link removed]. If you want to opt for joint/aggregated or separate married assessment then (as above) you need to do it soon.

 

[Ham Slicer]

I have been taxed seperately to my husband for years, last year i left work for a while and earned in total 17,000 in 2006.
I thought i could transfer some of my tax allowance to my husband, be taxed as a couple and he would get a refund on some of the amount he paid 43% on by using the balance of what i didn't use at 20%.
He rang the tax office and was told he was too late. Can this really be the case? i wasn't to know how much i earned until end of dec., have to ring back but was hoping someone could enlighten me first.
Thanks.

If you have opted separate assessment as opposed to single assessment, you can still transfer excess credits & bands to your husband. No time limit applies.

A simple issue, Revenue sometimes make a meal of. You might need to request a P21 for 2006 for both of you first and when that has been sorted, call again about the transfer.

 

[ClubMan]

I was assuming that the original poster & spouse were on assessment as two single individuals. The terminology is a bit confusing so be careful to distinguish between this and separate married assessment. Just mentioning this for clarity. I realise that you specifically (Ham Slicer) would know this stuff.

 

[Trish2006]

The problem is that 2 people both in the higher band get married and just don't think about it. My husband and I didn't, it wasn't that we opted for single assessment, we just didn't do anything about letting revenue know wer were getting married. When I was pregnant we weren't sure how we'd deal with tax credits so we just printed out the form, filled it in, set hub as the assessable spouse but split credits 50 50 so we were still getting the same paycheque each month. When I went on mat leave we could have elected to have my credits transfer automatically but opted to keep them so I didn't pay much tax when I came back to work. If I hadn't returned it would have been a different story and that's when being registered as married comes in to play. Now I have to see what credits I used last year in the 6 months I was working and see if there is anything that I could have transferred.

If the OP plans to have any kids, this is one reason to register.

 

[ClubMan]

When I was pregnant we weren't sure how we'd deal with tax credits so we just printed out the form, filled it in, set hub as the assessable spouse but split credits 50 50 so we were still getting the same paycheque each month.

If I hadn't returned it would have been a different story and that's when being registered as married comes in to play.

But you must have registered as married based on the first sentence above in which you seem to describe registering for joint/aggregated married taxation.

Now I have to see what credits I used last year in the 6 months I was working and see if there is anything that I could have transferred.

I don't understand this. If you were on joint/aggregated married taxation then you should have automatically received the most beneficial tax treatment. If not or you were actually on separate married assessment then you should just ask for a P21 balancing statement for the relevant tax year to balance things up and get a refund of any taxes over paid. Where a married couple stay on single/individual assessment then they could end up worse off.

 

[nearly40]

Thank you to all,
"worth opting for joint/aggregated married assessment or separate married assessment instead of assessment as two single individuals "

I didn't know there was such a thing as separate married assessment , still havn't phoned revenue.
Do i have to send a marriage cert to prove we are married?

 

[ClubMan]

Did you read the Revenue FAQ that I linked to above?

 

[nearly40]

(hadn't but have now)
There is aGod after all.

After speaking to revenue again it turns out we are too late to be jointly assessed but as we were being assessed individually as a married couple(unbeknownest to me) we are not too late for a REVIEW, subtle difference which means my husband gets 9000 of my std rate quota and will get a refund of 22% (42%-20%) on 9000 which is 1980.

thanks for advice.