Money-saving expert Martin Lewis is urging married couples to check if they can apply for their Marriage Tax Allowance and saving some money in the process.
The scheme allows married couples to reduce their taxes by a substantial amount just by transferring some cash to the tax man. By transferring £1,260 of your Personal Allowance to your husband, wife, or civil partner, you can reduce their tax by up to £252 in the tax year.
Before the tax year ends, you can backdate your claim by up to four years. However, Mr Lewis has highlighted that not enough couples are taking advantage of this.
Read more: Five things to do before the end of the tax year, according to a money expert
Speaking on his podcast, Mr Lewis said: "This is urgent you can only claim back four tax years and if you do not do it by next week, the fifth of April, you lose it and you could lose big money." He added that 2.1 million eligible couples are not currently claiming their allowance.
He continued: "You can only claim back four tax years behind the current tax years which means that once we start the new tax year next week on the sixth of April, you lose the ability to claim back the 2018/19 tax year for a whole raft of different things.
"That's what you're losing and that's what you need to have in your need. Now, with the Marriage Tax Allowance, 2.1 million eligible customers are missing out as I said and to be eligible you need two things: in the couple, assuming you're married or civil partnership.
"If you are just co-habiting, if you are living together, even if you've been living together for 30 years and have 22 kids, you don't count, this was deliberate social engineering in the tax system by the government when they brought it in. So, to count, one of you must be a non-taxpayer, you do not pay income tax in a year.
He clarified that regardless of your employment situation or economic situation, you are still a non-taxpayer if you do not pay income tax. He added that you must be married to someone who is paying tax at the basic 20 per cent rate.
He clarified that both the non-taxpayer and taxpayer in a couple have £12,570 a year they can earn tax free each year. The non-taxpayer can give 10 per cent of that to the taxpayer and they do that by applying to GOV.UK.
Mr Lewis continues: "So now, that extra £1,260 is money that the tax payer would have paid tax on at 20 per cent, but now doesn't have to. Which means this year, they pay £250 less tax." He added: "You can backdate it four year but if you don't do it now and you were eligible in 2018/19 and you did it the next sixth of April while you'd get the same amount, you'd actually miss out because you'd be getting next years amount instead of four years ago's amount.
"If you claim right now, then you will backdate four years, you will get this year's, and then it automatically carries on you will get a new one next year. Now in the current year, they just changed your tax code of the basic rate taxpayer so they pay less tax through the payroll.
"But if it's backdated you tend to get it in backs or a cheque so the total amount this is worth for someone who's eligible going back the full four years right now is £1,242."
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