Can I make use of my wife’s unused personal allowances?
The short answer is you technically can’t use her allowances but you can arrange your affairs so that your wife fully utilises her allowances. For example, if you have investments held in your sole name that produce income and capital gains you could transfer ownership of some of these to your wife. In this way any future income and capital gains are assessed against her allowances. So with a bit of careful planning you can ensure that all of your allowances are used and consequently cut your tax bill.
The other good bit of news is that inter-spouse transfers are exempt from Inheritance Tax.
Utilising all tax allowances available to you is such a simple and effective bit of financial planning that the most widely read article on this site is Money tip #81 – Utilise your family’s annual tax allowances and slash your tax bill. This article answers your question in full and will tell you all you need to know.
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