Income tax allowances and amounts
If you’re a taxpayer living in the UK, there’s a certain amount of money you can earn every tax year before you have to pay income tax. This tax-free amount is called your Personal Allowance. A tax year runs from 6 April one year to 5 April the following year.
There are extra allowances you can get if you’re married or if you’re blind or severely sight impaired.
How allowances work
If you earn money or get an occupational pension, you're usually taxed through the Pay As You Earn (PAYE) system. You'll get some tax-free income every payday because of your Personal Allowance and any other allowances you're eligible for. The amount you earn or get as pension above this level will be taxed.
This means your allowances are spread equally over the year, rather than you starting to pay tax after you’ve received all your tax-free income. Find out more about the Pay As You Earn (PAYE) system.
Your Personal Allowance is the amount of tax-free income you can earn each year through your earnings or pension. The Personal Allowance for the tax year 2020 to 2021 is £12,500.
Your Personal Allowance goes down by £1 for every £2 that your adjusted net income is above £100,000. This means your allowance is zero if your income is £125,000 or above.
If you're married or in a civil partnership
If you're married or in a civil partnership, you might be able to claim Marriage Allowance or Married Couple's Allowance. Marriage Allowance lets you give part of your Personal Allowance to your partner, and Married Couple's Allowance works as a deduction from your tax bill.
Whether you can claim Marriage Allowance or Married Couple’s Allowance depends on if you were born after or before 6 April 1935.
If you or your partner were born on or after 6 April 1935
You might be able to claim Marriage Allowance, which allows you to transfer £1,250 of your Personal Allowance to your spouse or civil partner if:
- your annual income is £12,500 or less
- your partner's income is between £12,500 and £50,000 (or between £12,501 and £43,430 in Scotland)
- you were born on or after 6 April 1935
This will reduce the amount of tax your partner has to pay by up to £250 every tax year.
If either you or your partner were born before 6 April 1935, you're likely to get more from Married Couple's Allowance.
You can apply for Marriage Allowance on GOV.UK.
You earn £8,000 a year, and your Personal Allowance for tax year 2020 to 2021 is £12,500. You won't pay any income tax on what you earn.
Your partner also has a Personal Allowance of £12,500, but earns £15,000 a year. They'll usually pay 20% income tax on everything they earn over £12,500.
Transferring £1,250 of your personal allowance to them will bring their personal allowance up to £13,750 (£12,500 + £1,250). This means they won't pay income tax on their first £13,750 of earnings. This will reduce their income tax liability by £250.
Your personal allowance will be reduced to £11,250 (£12,500 minus the £1,250 you transferred to your partner). As you earn less than this, you still won't pay any income tax.
If you or your partner were born before 6 April 1935
You might be able to claim Married Couple's Allowance if you're living together as a married couple or as civil partners and one or both of you were born before 6 April 1935.
The rules about Married Couple’s Allowance depend on the date you married or became civil partners, as well as the age of the older partner.
- If you married before 5 December 2005, the husband gets the Married Couple’s Allowance and the amount depends on the husband's income and the age of the older partner.
- If you married or became civil partners on or after 5 December 2005, the partner with the higher income claims the Married Couple’s Allowance and the amount depends on the age of the older partner and the income of the partner with the higher income.
- If you married before 5 December 2005 you can choose to have the rules which came in on 5 December 2005 applied to you, so that the partner with the higher income gets the Married Couple’s Allowance. Contact HMRC to ask them about making the change.
HM Revenue and Customs Taxes Helpline
Tel: 0300 200 3300 (Monday to Friday from 8.00am to 8.00pm; Saturday from 8.00am to 4.00pm)
Textphone: 0300 200 3319
If you want to change how your allowance applies, you can apply to HMRC to either:
- share the minimum Married Couple's Allowance between you
- transfer the minimum Married Couple's Allowance to your husband, wife or civil partner - if you both agree
If you get Married Couple’s Allowance, you’re still entitled to a Personal Allowance and Blind Person’s Allowance - if you’re eligible
You can get Blind Person's Allowance, which means you can earn more money before you have to start paying income tax. You get it on top of your Personal Allowance.
You can claim Blind Person's Allowance if you’re registered as blind with your local council and you have a certificate or document to say you're blind or severely sight impaired.
HMRC can give you the allowance for the tax year before you registered as blind if you got the evidence needed for registration during that tax year. This could help you if there’s any delay with registering as a blind person.
If you're married or have a civil partner and can't use all of your Blind Person's Allowance, you can ask HMRC to transfer the unused part of the allowance to your husband, wife or civil partner. You can do this whether or not they're also blind. If you also get Married Couple's Allowance, you must transfer any surplus Married Couple's Allowance at the same time. If both of you are registered as blind, you can both get the allowance.
Find out more about Blind Person's Allowance on GOV.UK.
Check how much Blind Person’s Allowance you'll get
This table shows the rate of Blind Person’s Allowance for the current tax year and the 4 years before that.
|Blind Person’s Allowance||£2,500||£2,450||£2,390||£2,320||£2,290|
Get help with tax allowance problems
Find out more about tax allowances on GOV.UK.
If you think you should be getting an allowance
If you’ve paid some tax on your income and you think you’re entitled to an allowance but you’re not getting it, you should claim it from HM Revenue and Customs (HMRC) by calling the Taxes Helpline on 0300 200 3300.
If you haven’t received all the allowances you’re entitled to, you can make a backdated claim for them. However, there’s a time limit for doing this. Find out more about backdating a tax allowance claim.
If you're over 60 or get a state pension
Allowances for older people can be complex. You can work out if you should be paying tax in retirement on GOV.UK.
You can also get more information about tax on the Low Incomes Tax Reform Group website.
You can get help and advice from Tax Help for Older People if you:
- are aged 60 or over
- are on a low income
- have a problem with your tax allowances that you can't sort out with HMRC
You can call them on 01308 488066 or email firstname.lastname@example.org.