Martin Lewis has shared the ‘huge’ impact that marriage can have on a partnership, explaining the rules around one specific tax that change after you’ve tied the knot

Martin Lewis has shared a ‘really big benefit’ of marriage, but hopeless romantics won’t be too pleased.

If you think that the only reason people get married is because they’re madly in love with each other, think again. There are many other reasons they want to walk down the aisle.

Sharing a clip from ITV 1’s The Martin Lewis Money Show, he said that marriage can have “hidden financial benefits,” saying it can save you a huge amount on inheritance tax.

Gobsmacked viewers learned that marriage can save you up to a whopping £200,000 on inheritance tax, and the money mogul explained how.

“Where marriage really counts is when you die,” Lewis explained, as he was met with awkward laughter from the in-studio audience.

He said: “So the first thing to say. Anything you leave to your spouse is exempt from inheritance tax. So there is no tax to pay on anything that you leave your spouse.”

Lewis did clarify that “for this to count,” you both have to be “UK residents” or it “can get complicated”.

Next, he gave a tip, which he claimed was the “big one”. Lewis shared: “Any unused inheritance tax allowance passes on to your spouse. You don’t need to do anything to activate it, although, when you die, the executors need to send the documents to HMRC.”

He reiterated that “this is only if you are married or in a civil partnership. Living together doesn’t count.”

Lewis then showed an example of the “big” impact it can have. The example read: “Now imagine…Mr and Mrs Youngatheart have £1 million of assets, including their primary home.”

He explained while showing a picture of the couples standing separately: “There you are, Mr Youngatheart and Mrs Youngatheart. And these are their inheritance tax allowances. They have one each. So look, everybody in their estate can give £325,000, and their inheritance tax is paid on it.

“Above that, you get another £175,000 if you’re passing on your primary home to your direct descendant. So that’s children or grandchildren, including step-children, foster children, and adopted children. You pass that on; you get an extra £175,000 as long as your total estate isn’t worth more than £2 million, where it’s gradually taken away.

“Now, I have some very bad news, everyone -–Mr Youngatheart has passed away. But he leaves everything to his wife. Now, because he has left everything to his wife, he has not used any of his inheritance tax allowances, and therefore, she gets the inheritance tax allowances that he had”.

Lewis pointed to an audience member, saying that he’d “just seen his face” as he was shocked, highlighting the huge “impact” of being married.

He continued to explain: “So, now, she can pass on £650,000 and another £350,000 if they’ve got the primary residence, that’s £1 million. Now, let’s just imagine that they did exactly the same thing, and they weren’t married.

“So, you’ve got Mr Youngatheart and Miss Dout. Missed out, there you go,” he chuckled as the audience laughed along with him.

He continued: “In that same scenario, he’s left everything to his partner, so he’s used up his inheritance tax allowance. Now, if she leaves everything to the kids, she only has half of that. So that’s £500,000; she’s going to be paying tax on it.”

He then said: “Depending on the tax, we could be talking £200,000 of inheritance tax paid because they weren’t married.”

Lewis joked to an audience member: “Have you got the ring yet?”

If you need personalised financial advice about any money situation, speak to a financial advisor.