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Future Self Assessment tax returns

25/04/2019 16:23:18
Hello. I am aged 64 and will soon be 65. I receive my state pension (almost the full amount) in January 2020. I have just submitted my latest self assessment, 2018-2019. I have completely stopped working at the end of 2019 but have only earned a small amount of self employment income since leaving my employment back in 2015. I receive a BT pension (paid gross) and with my small amount earned from self employment, have been well below the tax threshold since 2015. I have a couple of questions please.

1) With my BT pension and state pensions combined, from January 2020 onwards, I will have an income within the normal the tax threshold for 2019-2020 but the years after that, 2020-2021 (a whole year of state pension), I will be slightly over the tax threshold. To help reduce my tax, my wife is planning to transfer the 10% of her threshold over to me (she has very little income as not working) but when can I do this? Can I do any time or do I have to wait until I have the state pension and my total income rises above the tax threshold?

2) Can I stop making a return completely? To be honest, it is so easy to fill in as I can skip most sections and even self employment from now on. Is there a short return?

3) Will my state pension be paid in full (i.e. no tax) and my BT pension tax code (currently paid gross) changed to pay the very small amount of tax I might have to pay?

I hope someone can answer these questions. Thanks in advance.Rob
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Re:Future Self Assessment tax returns

29/04/2019 08:08:07
Hi,

Rob you can apply for marriage allowance any time after the 6th April 2020 as there would no financial benefit if you apply for marriage allowance as a non-taxpayer.
Your wife will need to apply for the marriage allowance transfer as she will be the transferor.
You can find more information by following the attached link:

Marriage Allowance

You can check if you will still need to complete a tax return by checking your self assessment criteria here:

Check if you need to send a Self Assessment tax return

If you do not need to complete a return, please call the self assessment helpline on 0300 200 3310 to enable us to close your record. The helpline is open Monday - Friday 8am to 8pm, Saturday 8am to 4pm and Sunday 9am to 5pm.

State pension is a taxable benefit but the tax is not deducted at source. Your BT pension will be shown as your primary income and the amount of state pension you receive will be deducted from your personal allowance. For example - the personal allowance for 2019/20 is £12500 - if you were due to receive £10000 state pension your personal allowance would be £2500. This would then be applied to your BT pension with a tax code of 250L.

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