If you are married, use your marital status to save tax. No one will thank you for forgoing the tax-saving opportunities we tell you about in this section. If you want to get the best out of marriage and tax, you and your partner need to trust one another financially as well as in the usual ways. The strategies listed here generally require that couples either divide their assets up between themselves or that the better-off partner hand them over to the other. Probably the biggest tax benefit of marriage is that you can pass ownership of money and other assets between the pair of you without tax hassles. Marriage can, for some couples, be worth £1,000 or more in tax savings each year.

Of course, not every couple is able to save this sort of money. You need to have enough savings first of all to make it worthwhile switching the ownership from the higher-paid partner to the lower-paid one. There are no limits to any moves of money between spouses. The tax inspector seems to forget independent taxation of women and go back to a former age when a husband was responsible for the taxation of all the income-producing assets his wife possessed. When assets are shared out, the division has to be real. The partner who gives something away cannot demand the assets back or have the income from them paid to her or his bank account. The new owner must have absolute ownership and control, including the right to sell.

Sorting out your tax allowance Each partner in a marriage, along with every other taxpayer, has a personal income tax allowance. This stands at £4,895 for the 2005-06 tax year. Some people don't have sufficient earnings from work and from interest on savings accounts to use up their personal allowance. If this is the case for you, but your spouse earns enough to use up all his or her allowance and then some, it makes sense for your partner to transfer income- or interestproducing assets to you (or vice versa if the financial situation is reversed):

• Geeta earns £25,000 a year from her job, and the total of her income puts her in the 20 per cent tax band, so the £2,000 interest she is paid on her savings account costs her £400 in tax. Her husband Vijay has no income of his own. Geeta can transfer all her savings to Vijay so that he can reclaim the interest and the household is £400 better off.

• Patrick earns £50,000 a year and is a top-rate taxpayer. The £5,000 he earns from his £100,000 savings account loses £2,000 (40 per cent) to the taxman. His wife, Rachel, earns £20,000 a year and has no savings of her own. She is a basic-rate taxpayer for whom the 20 per cent savings rate applies. If Patrick gives all his savings to Rachel, they would save £1,000 a year, the gap between 20 per cent and 40 per cent of the £5,000 interest. But Patrick needs control day-to-day over some of the money so the couple agree to joint ownership. The result is Patrick now pays £1,000 tax on the £2,500 he earns in interest while Rachel pays £500 on her portion. The couple is now £500 better off.

Swapping your assets Each partner in a marriage has their own capital gains tax annual allowance. capital gains tax (CGT) is payable when you make a profit in selling or transferring an asset to someone else but using the allowance lets the seller have that amount of any such gain tax free. Keeping an investment portfolio in just one partner's name means a couple can make use of only one capital gains tax allowance. But dividing up the assets potentially liable to CGT, as married people can do freely, doubles the potential tax savings by giving two CGT allowances to use instead of just one. In some cases, sharing out stocks and shares in this way also reduces the income tax payable on dividends. Chapter 6 in this Book has the lowdown on dealing with capital gains tax.

Inheriting each other's assets When a husband or wife dies, the surviving partner doesn't pay any inheritance tax on any transfer of assets between themselves whether during their lifetime or in a will. Inheritance tax is not levied on anything that passes between spouses. Chapter 4 in Book V on inheritance tax has more details of what to do and what to avoid doing.

Taking a stake in a pension Spouses can invest up to £2,808 a year into a stakeholder pension for their other halves, irrespective of the partner's income. This contribution qualifies for automatic tax relief at the basic 22 per cent level, taking the real value invested into the pension plan up to £3,600. This limit seems to be fixed in stone, it does not rise each year. The pension company does all the paperwork and increases the payment into the pension scheme in line with this tax relief.