David Cameron has announced recently that the government will
put forward proposals for a transferable tax allowance for married
couples and civil partners “shortly”. This could be as soon as the
Tory backbenchers have been putting the prime minister under
pressure to honour a plan for tax breaks that was originally made in
the 2010 election manifesto. However, Labour is against the idea and
the Lib Dems were given a specific opt-out in the coalition agreement
which means they do not have to support it.
Under the plans being considered, wives and husbands who do
not work and pay no income tax would be able to transfer part of their
annual tax-free allowance to their spouse if their partner earns less
than the amount at which the higher rate of tax is payable. This is
currently set at £41,451.
When it set out the plans in 2010, the Conservatives said they
would make four million married couples and civil partners £150 a year
better off. However, no detail is yet available about what exactly is
being proposed in terms of a transferable allowance now, although it
would only apply to basic rate taxpayers and may not be in force before
the next election.
Mr Cameron said: “The point is that we are going to be putting
in place the marriage tax proposal in law. We will be announcing plans
for that in this Parliament, quite shortly in fact.”
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