Personal Allowance increased to tax-free £13,830 for certain households

The tax-free has been frozen for years and, barring an unexpected U-turn from the , is set to remain at its current levels until at least 2028. This means that due to 'fiscal drag', more people will end up paying higher taxes on their earnings as wages increase to counter inflation and more people earn money liable to income tax.

The Personal Allowance, which is the amount you can earn before you start paying tax, remains at £12,570 and is expected to stay at this level until 2028 at the earliest. This means everything you earn above this is taxed at 20%, or 40% on earnings above £50,270 for a higher rate taxpayer and 45% above £125,000 for an additional rate taxpayer.

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However, there is one way to increase your tax-free Personal Allowance - but it requires being married or in a civil partnership. For the 2020-21 tax year, time is quickly running out to make a backdated claim if you need to claim for that year.

Married couples or those in a civil partnership can increase their tax-free take-home pay by £252 per year and backdate their claim for four years.

This rule applies to up to four separate tax years if you backdate the claim. This means you could be looking at a tax rebate of up to £1,258, reports .

HMRC will then adjust your tax code to give you the money you're owed, which when added to the standard Personal Allowance for the year (£12,570) comes out at £13,830 tax-free instead of £12,570, handing you the £1,260 for the four years' worth of £252.

To qualify, one partner must pay no income tax - so earn under £12,570. For instance, if one of the couple is not currently working, has lost their job or is taking a career break for childcare. The other must be a basic rate taxpayer earning between £12,570 and £50,270 (once pension contributions are deducted).

This process, known as the Marriage Allowance, allows the lower-earning partner to transfer £1,260 of their Personal Allowance to their partner and reduce their tax bill by £252 for each year claimed (20% of £1,260).

For 2024-25 a slight change was made that also allows someone earning between £11,130 and £12,570 to transfer their Personal Allowance, although earnings in between those amounts are still liable for tax. It does still work out to a saving, just not as great as those earning less than £11,130.

However, if you need to claim for the 2020-21 tax year, you must do this before Sunday, as you can only backdate your claim for the current year and the past four financial years, so 2020-21 will be too far back as of April 6.