Increase tax-free Personal Allowance to £15,700 with one condition | Personal Finance | Finance

The new tax year is here and with it come the inevitable tax bills, HMRC demand letters and tax code changes as the taxman catches up with what you earned and what you owe for the past year – and what you might owe them for next year. And the single biggest factor in what you end up paying to HMRC in tax – other than your earnings – is the Personal Allowance threshold.

The Personal Allowance, the amount you’re allowed to earn tax-free, is fixed at £12,570 and has been for years – but there is a way to boost it legally to earn more without losing any of it to tax. Blind Person’s Allowance is added to your yearly Personal Allowance each year, boosting the amount you can earn before you lose 20% of your earnings to Income Tax.

It means that if you’re registered blind, you can increase your Personal Allowance this tax year by £3,130 to £15,700.

That means you would pay no tax on the first £15,700 you earn, giving you an extra £626 back in your pocket (because you don’t lose 20% of that £3,130 extra allowance).

What’s more, you can transfer your Blind Person’s Allowance to your spouse or civil partner (you have to be married for this to work, or in a marriage equivalent civil partnership – cohabiting won’t be enough), if you don’t earn enough to use up the allowance yourself.

If both you and your partner are eligible, you can both receive the allowance at the same time, too.

You don’t have to be completely blind in order to claim the boost, just be registered with your council as blind or severely sight impaired (ie legally blind).

According to HMRC, you can claim Blind Person’s Allowance in England and Wales if:

• you’re registered with your local council as blind or severely sight impaired

• you have a certificate that says you’re blind or severely sight impaired (or a similar document from your doctor).

In Scotland and Northern Ireland, the rules are slightly different:

You can claim Blind Person’s Allowance if both of the following apply:

• you cannot do work for which eyesight is essential

• you have a certificate that says you’re blind or severely sight impaired (or a similar document from your doctor)

To claim, call HMRC on 0300 200 3301.

There are other allowances you can claim to boost your allowance too, such as Married Couples Allowance, which allows you to transfer some of your unused allowance to a married partner if you’re a basic rate taxpayer and they’re a non-taxpayer.