Don’t forget your Marriage Allowance!

The Marriage Allowance has been around since 5 April 2015. It allows you to transfer 10 % of your Personal Allowance (£1,150) to your husband, wife or civil partner – if they earn more than you. This reduces your partners tax by up to £230.

Who can apply for Marriage Allowance?

You need to meet the following conditions in order to apply for the marriage allowance:

·         You and your partner were born after 6 April 1935

·         You’re married or in a civil partnership

·         Your income is £11,500 or less

·         Your partner is a basic rate taxpayer (ie. income between £11,500 and £45,000 or £43,000 in Scotland)

If all these conditions apply, you claim can be backdated to include any tax year since 5 April 2015 that you were eligible for Marriage Allowance. You will keep getting the tax break in the future too as long as the eligibility doesn’t change.  If your circumstances do change, you or your partner can cancel the marriage allowance online.

How to apply

To apply for it online, follow this link https://www.gov.uk/apply-marriage-allowance

To apply by phone, you can call HMRC on this number 0300 2000 3300

You will need yours and your partners national insurance number and something to prove your identity.

More information

More information can be found here:

https://www.gov.uk/marriage-allowance

As usual, if you would like any further details on this or any other accountancy matters, please follow this link:

In the meantime, here is a download for next month’s tax deadlines: October tax dates

National Insurance Class 1

Class 1 national insurance is due to HMRC if you are in employed work and are earning a salary at a certain level. Class 2 national insurance will be abolished in April 2018 leaving only a new potentially reformed Class 4 national insurance for self-employed workers.  The Class 4 NI could be changed to make it more like Class 1 NI with entitlement to state benefits that are currently available by paying Class 2 NI.  So, for that reason, I will look at Class 1 NI in more detail here. Continue reading “National Insurance Class 1”

VAT rates in the UK

VAT was originally introduced as a simple tax on purchases of goods and services in 1973. It was originally called the purchase tax but changed its name to VAT when the UK joined the EEC. VAT is now anything but simple.  It is an indirect tax charged on the purchase of goods and services. Most goods and services in the UK are charged at the standard rate of VAT which is currently set at 20%.  Continue reading “VAT rates in the UK”

My Favourite Accounting Apps

These are just my favourite accounting apps and in the link to their website, which can be found by clicking the title, has no affiliate links that I benefit from.  There are obviously so many accounting apps out there that will help you sort out your finances and keep you on top of your paperwork and sometimes you just have to use trial and error to find the ones you are happy with. Continue reading “My Favourite Accounting Apps”

What is Corporation Tax?

In its most simplest definition, if you have a limited company, you would need to pay tax on your profits.  This is called Corporation Tax. You would also need to pay corporation tax if you are an association, a club or co-operative.  If you are a sole trader or a partnership, your profit is not subject to corporation tax and any tax you have to pay will be through your self-assessment. Continue reading “What is Corporation Tax?”

Still none the wiser

I’m still none the wiser as to what I am doing with my life.  I’ve written about it in this post on Accountingweb which you can read here: confusion-and-plans

However, since writing this post, I was driving down from my mum’s house at around 7pm. Usually, I can take it or leave it when it comes to driving however, this time I really did enjoy the drive.  The girls had both fallen asleep, (one of the main reason for driving home at around 7pm) and the sky was turning from bright yellow sunlight and wishing I had sunglasses on, to a red sky with orange streaks, to a dusky blue with strains of the leftover orange .  It was so beautiful especially with my favourite Bollywood songs softly playing in the background (another ploy to get the girls to fall asleep). Continue reading “Still none the wiser”

What is income tax?

A dictionary definition and its simplest explanation, income tax is the tax levied on personal income that you earn.

What is personal income?

Personal income that is taxed in this way is made up of:

Continue reading “What is income tax?”