It’s highly unlikely that the taxman is given a second thought on your wedding day. But after you say “I do” you might be surprised to find out that getting married comes with a number of tax benefits, some of which could save you thousands. These are the most common:
- Capital gains tax – Normally for tax purposes assets are transferred at market value. However, assets can be transferred between spouses at no-gain/no-loss. This important exemption can be used to reduce the capital gains tax liability for the family, ensuring that both spouses use their annual exempt amount.
- Inheritance tax – there is an age-old joke among accountants that the best planning advice when it comes to inheritance tax is to get married. This can still be the case today as assets transfer between spouses free of inheritance tax. Any unused nil rate band assets on your death also transfer to your spouse, (if you’re unmarried this will be wasted).
- Transferrable marriage allowance can also be beneficial, since if one half of a couple is not able to use the full personal allowance, an individual can elect to transfer 10% of his personal allowance to their spouse. This could save up to £238 of tax.
- Married couples’ allowance – If you are married and one of you is at least 84 years old you can claim the married couple allowance and save up to £869.50 in tax.
Of course, getting married shouldn’t be about tax breaks, but if you think any of the points raised above apply to your situation please contact your local AIMS Accountant for more information.