By David Watkinson – WatkinsonBlack
THERE has been considerable publicity recently concerning people signing over tax repayments to third parties, and then not receiving the benefit of a large part or all of those repayments.
At risk of being greeted by cries of “You would say that, wouldn’t you?”, our advice would always be to seek tax advice from a reputable firm of a accountants. They will also provide an initial meeting at no cost, and agree a fee in advance, with any increase due to additional work similarly agreed.
One of the more popular targets for these companies is the Claim to Transfer The Marriage Allowance. This lets one spouse or civil partner transfer 10% of their personal allowance to the other spouse or partner, provided only that:
- The lower earning spouse or civil partner has total income below the personal allowance; and
- The higher earning spouse or civil partner has total income in excess of the personal allowance but less than the level at which higher rate tax is payable, ie they are basic rate taxpayers.
Currently, the amount of allowance that can be transferred is £1,260 and this can save tax of £252. If you have not claimed before then you can backdate your claim by up to 6 years, which means that, until 5th April 2023, you can currently claim for any tax year from 2018 onwards.
There are many cases of people losing as much as half of their savings to agents acting on their behalf, If fact, this has become so prevalent that the tax office is proposing to amend the rules relating to the payment of tax rebates to agents, including:
- Making assignments of income tax repayments void, although nominations of repayments to third parties will continue,
- Requiring repayment agents to register as agents with HMRC, and
- Consider ways of strengthening evidence that a claim has been properly made with a taxpayer’s consent
If you wish to make a claim yourself without involving an agent then details on how to do so, with a link to the relevant online application form, can be found at:
www.gov.uk/marriage-allowance/how-to-apply
If you follow that link then you will see that there is no cost to making the application, and that the claim should be made by the lower-earning partner, ie the partner who wishes to transfer a part of their allowance to the other partner. If you already have a Government Gateway User ID and Password then the only additional information needed to make a claim is your own and your partners National Insurance Number. If you have not used the Government Gateway before then you will need to register. To do so you will need your National Insurance Number and 2 forms of ID such as a passport , valid UK photocard driving licence, a current payslip or P60, details held on your credit record, or details from a submitted tax return or tax credit claim.
We have concentrated here on claiming the marriage allowance, but the points apply generally to any return or claim made. In general, please be very aware that the official web page of any government department will start with www.gov.uk/……
If you google a query such as claiming a tax refund, paying your tax, or any other query then the first half dozen results will be advertisements for commercial firms. These may be genuine firms of accountants or solicitors, but by clicking on one of those you may well be taking the first step to being overcharged.
It is a mistake that is easily made. The writer admits to inadvertently following one of those links when looking for information from Companies House, and it was only when he was nearly charged £50 for information that he knew was available free of charge that he realised his mistake.
To quote Kojak “Hey. Let’s be careful out there!”
