Autumn Statement: Transferable tax allowances – a small step in the right direction
Delivering the Autumn Statement today, the Chancellor confirmed that the transferable tax allowance for married couples and civil partners would go ahead from April 2015.
Robin Williamson, Technical Director of LITRG, commented:
“The new transferable tax allowance will be of some help to couples where one partner has income below the personal allowance and wishes to transfer the unused balance of their allowance to the partner with the higher income. Pensioners in particular should benefit, as should working couples where one partner stays at home to look after the children.
“Nevertheless, the tax saving (£200 maximum) is small and, like the personal allowance itself, the value can be eroded if the couple is in receipt of means-tested benefits because entitlement to them is based on net, after-tax, income. If a reduction in tax causes net income to increase, means-tested benefits reduce proportionally. But the principle is right and the Chancellor commented that this was only a start.
“So that the new allowance can be within reach of all low-income couples who are intended to benefit, particularly the elderly, we call upon the Government to make available non-digital methods of claiming it in appropriate cases.”
Contact: Robin Williamson (please use form at http://www.litrg.org.uk/ContactUs)