Exchanging vows might make you happier but it won't make you wealthy through tax savings unless you are taxed at a different rate than your partner, writes Laura Slattery.

February 14th is traditionally a day when engagement rings are spontaneously presented over dinner and wine in restaurants all over the country. If you choose today to make or accept a proposal and you're cynically dreaming of the tax breaks you will get once you've signed the register, it could be worth knowing that in many cases marital status won't make a major difference to your tax bill.

Exchanging vows might enrich your happiness, but it won't make you wealthy through tax savings unless you are taxed at a different rate than your partner.

Getting married can significantly lower your capital gains tax or inheritance tax liability, but it will only reduce your joint income tax bill if one person earns less than the standard rate cut-off point of €28,000, paying tax at the standard rate of 20 per cent, and the other person earns more than €28,000 and pays tax at 42 per cent on earnings above this point.

The unused part of the lower earner's standard rate allowance can be transferred to the higher earner, cutting the overall liability.

Tax isn't something that people have to consider so much anymore when getting married, according to Ms Anne Bolster, senior manager at PricewaterhouseCooper's HR solutions group. "It's something that would have been a bigger deal a few years' ago," she says.

Although there would be lots of exceptions, you tend to find couples getting married will both be earning around the same amount, she says.

"I think less people advise the Revenue that they get married now, because they don't need to transfer the rate band. They probably pay exactly what they would have paid anyway," says Ms Bolster.

Married couples used to be able to avail of a standard rate band that was double that available to a single person, even if there was just one income. But between 2000 and 2002, the Government adopted a policy known as individualisation, which was designed to reduce the tax burden on double- income families.

It also involved increasing the level of income at which single people became liable to pay tax at the top rate. Part of the process was to ensure that standard rate bands were not transferable between spouses.

Currently, €19,000 of the standard rate band is non-transferable, so getting married will mean a maximum of €9,000 of the standard rate allowance unused by the lower-earning spouse can be transferred to the higher earner. Once one spouse earns more than €37,000 or both spouses earn more than €28,000, they will start paying tax on the balance at 42 per cent.

The example opposite shows how marriage can result in small tax savings, however. Clare earns €38,000 and John earns €22,000. Their combined income tax payable as single persons is €9,560. As a married couple, the tax liable is €8,240. By transferring €6,000 from John's standard rate band to Clare, their total tax bill is now €1,320 less.

In the year of marriage, both partners continue to be treated as two single persons. If it turns out that the tax you pay as two single persons in that year is greater than the tax that would be payable as a married couple, you can claim a refund of the difference for the proportion of the year for which you were married.

If John and Clare married in the middle of July, they would receive a refund for the six full months of the year that they were married. This would amount to €660 (6/12ths of €1,320). So it can help to take as pro-active approach to your taxes as you do to organising your wedding - a few hundred euro is not to be sniffed at, especially if you went into debt to pay for the reception.

"Quite regularly, when people get married and they're both in professions, they keep their tax system as it was. They never tell the Revenue and they never claim the refund," says Mr Liam McNamara of legal firm McNamara & Associates. Going forward, they can lose out too, he adds.

Married couples who do declare their wedded bliss to the Revenue will face a menu of taxation methods from which to choose: joint assessment, separate assessment or assessment as a single person. Assessment as a single person is also known as separate treatment and is usually less favourable, as it prevents any transfer of credits or tax bands.

Joint assessment is the default option automatically given by the tax office once you advise them of your marriage. It is by far the most common tax treatment and the only practical option if just one spouse has a taxable income.

A married couple will always have the same combined tax bill under both joint and separate assessment.

Under joint assessment, if both spouses have taxable income, they can decide which person is to be the assessable spouse and request the tax office split any transferable tax credits and standard rate cut-off point between them.

When the tax office does not receive any request for the allocation of credits and reliefs in a particular way, it will normally give all the tax credits, apart from the other spouse's PAYE and expense tax credits, to the assessable spouse.

Under separate assessment, your tax affairs are independent of those of your spouse. The married tax credit is divided equally between the spouses. Like joint assessment, any unused tax credits and standard rate cut-off point up to €37,000, other than the PAYE and expense tax credits, can be transferred to the other spouse, but at the end of the tax year.

Separate assessment would be used for "pure convenience" if one person was self-employed and the other person was a PAYE employee, says Ms Bolster. Joint assessment can prove flexible in this situation, too, as the couple can let their circumstances dictate whether most of the tax should be paid under PAYE or in a lump sum assessment.

"Under separate assessment you won't pay any extra tax, but you have to apply to get a refund," says Ms Sandra Gannon, a tax consultant at the Taxation Advice Bureau.

"You wouldn't come across it a lot, because you have to consciously elect to do it."

But some couples would like to keep their earnings separate, Ms Gannon adds. "Good old-fashioned independence" is one reason for choosing separate assessment, agrees Ms Bolster. "People want to file their own tax return," she says. Latest figures from the Revenue show that just over 27,000 people opt for separate assessment.

To claim separate assessment, one of the spouses must write to the tax office between October 1st and March 31st: the period three months before and three months after the start of the tax year.

March 31st is also the deadline for nominating which spouse is the assessable spouse under joint assessment. If no nomination is made, the tax office decides the assessable spouse will be the person with the highest income in the latest year for which details of both spouses' income are known.

This is another recent change to the tax system, notes Ms Bolster. "In the old days, the husband was automatically the assessable spouse."