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These examples illustrate points made in E1.920 and E1.923.

Example 1—interaction between married couple's allowance and age-related personal allowances (2015/16 and prior tax years)

In 2014/15, George is aged 82 and has net adjusted income of £34,500. His wife, Mildred, is aged 63 and had income of £20,000 in that tax year. They got married in 1975 and have not made a joint election for the rules in ITA 2007, s 46 to apply, so George is the primary claimant for the married couple's allowance.

In 2014/15 the age-related personal allowance was £10,660, the basic personal allowance was £10,000, the maximum married couple's allowance was £8,165, the minimum married couple's allowance was £3,140 and the income limit was £27,000.

As George's income exceeded the income limit, his allowances needed to be reduced by half of the excess. The age-related personal allowance was reduced first and then any remaining abatement was used to reduce the married couple's allowance.

The total abatement was £3,750 ((£34,500 – £27,000) / 2). The age-related personal allowance was reduced first and then any