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The transferable couples allowance is poorly designed and too complex
KEY POINTS
- Separate assessment was introduced in 1990.
- The high-income child benefit charge and transferable allowance undermine that principle.
- Will £210 a year encourage people to marry and stay married?
- A simple relief but with more complicated provisions.
- An election could increase income tax liability.
Some years ago the government of the time took a bold step when it introduced independent taxation. Until that time married women’s income had been returned for them for tax purposes by their husbands. Her income was clearly his.
The couple’s income was aggregated and taxed on the husband subject to a wife’s earned income relief which he received if the wife was employed or self-employed.
It was possible to elect for separate assessment allowing a woman to submit a...
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