Tax-Free Allowances You Might Be Missing
The UK tax system includes several allowances designed to help individuals keep more of their money. Many people miss out on these simply because they don't know they exist.
**Marriage Allowance**
If you're married or in a civil partnership and one partner earns significantly less than the personal allowance, the Marriage Allowance could save you up to £252 per year. The lower-earning partner can transfer their unused personal allowance to the higher earner, reducing their tax bill. It's simple to claim through HMRC's online portal.
**Trading Allowance**
If you're self-employed or have income from a trade or profession, you can claim a trading allowance of up to £1,000 per year. This is deducted from your trading income before calculating tax, effectively making the first £1,000 of trading income tax-free. This is particularly useful for freelancers with modest incomes.
**Property allowance**
Similarly, if you have rental income from a property, you can claim a property allowance of up to £1,000. This works the same way as the trading allowance, reducing your taxable rental income.
**Savings allowance**
Basic rate taxpayers can earn up to £1,000 in savings interest tax-free. Higher rate taxpayers get £500, and additional rate taxpayers get nothing. This allowance is separate from your personal allowance and applies specifically to savings income.
**Dividend allowance**
You can receive up to £500 in dividend income tax-free each year. Dividends above this are taxed at 8.75% for basic rate taxpayers, 33.75% for higher rate taxpayers, and 39.35% for additional rate taxpayers.
**Claiming these allowances**
Some allowances are claimed automatically, while others require you to register or claim them. The Marriage Allowance and trading allowance must be claimed through HMRC. If you're unsure whether you're eligible, it's worth checking — the potential savings can be significant.
**Learn more:** For professional guidance on this topic, visit [Accounted For Ltd](https://accountedforltd.co.uk/self-assessment).
Learn more: For professional guidance on this topic, visit Accounted For Ltd