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Tax Help Married Allowance and Married Couple's Allowance

  • Associate
  • Practice Licence
  • 7 posts
  • # 114751

Hi All,

Having completed levels 2 and 3, I am complementing with the self assessment, but not through a tutor. I am using the ICB book purchased directly from ICB. The exam is based on 2015/16 tqax year, so all numbers relate to that year only, not 2016/17.

I am really struggling on marriage alllowances. 

The text book does not seem to differentiate between Married Allowance and married Couple's Allowance. Is this my lack of understanding, or is the maanual less clear than it should be?

The manual states "The married couple's allowance is given as a reduction of tax payable rather than as a reduction from taxable income, effectively giving tax relief at 10%".

Firstly is this the married allowance, whereby up to 10% of the total personal allowance may be transferred if unused, which I understand to be married allowance, or is this the addition allowance of £8,355 which I believe to be married couple's allowance and is age related?

Secondly, how is this an effective relief of 10%? If one spouse is paying tax at 20%, and they get a protion of the other spouse's allowance to use as relief, why is it not relief of 20%? 

Thirdly, why is this allowance taken off tax liability, and not off gross income as all other allowances are?

It really seems as if someone has spent weeks coming up with the most complex set of rules imaginable, and even having such similar names for different types of allowance is horribly confusing.

Any help much appreciated, thanks. 

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