Four million married couples to benefit from tax break

Plans for married couples to get tax breaks worth up to £200 a year have been announced by David Cameron. 

In a move that will potentially benefit four million households, married couples would be able to benefit from a £1,000 transferable tax allowance from 2015.

However, the tax break would only apply if neither couple is a higher rate tax payer and one spouse is earning less than the personal allowance (the amount of income you can receive each year without having to pay tax on it) which will be just over £10,000 in 2015.

Stay at home mothers and part time workers are thought to be the main beneficiaries and  the measure would also apply to 15,000 couples in civil partnerships.  Benefits from the scheme would come through at the end of the tax year in 2016.

The basic tax rate of 20% is currently in place for up to £32,010 of taxable income. That means that - including a personal allowance - at current rates people would have to earn less than £41,451 a year to be eligible.

The Prime Minister made a commitment to recognise marriage in the tax system eight years ago and renewed the vow in the 2010 election campaign but some backbenchers doubted that he would make good on his pledge in this parliament.

Labour said Mr Cameron was "out of touch" if he thought the people would get married "for £3.85 a week" and the move would be outweighed by higher VAT and cuts to child benefit and tax credits.

David Cameron firmly stated his commitment saying: "Other countries recognise marriage properly in the tax system and that's what we're doing".

Writing in the Daily Mail, Mr Cameron his wedding day was “the happiest day” of his life.

"There is something special about marriage: it's a declaration of commitment, responsibility and stability that helps to bind families.”

The scheme was welcomed by Archbishop of Canterbury Justin Welby and Samantha Callan from the think tank Centre for Social Justice who said;

"We did a report into the state of the nation and why family breakdown is such a problem in the UK today. Half of all children born today will not still be with both their parents by the time they're 15 and marriage is a more durable relationship."

 "Ninety-three percent of all couples still together by the time the child is 15 are married."

Labour pointed out that around two-thirds of married couples would not save money under the plans, including higher rate taxpayers and couples in which both partners earn more than the personal allowance.

Shadow chief secretary to the Treasury Rachel Reeves said: "The vast majority of children will see their parents get not a single extra penny from this so if you are a mum and dad and you're both earning £20,000-£25,000 a year, so on average earnings, you won't get any extra support.


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