The way the increment in the standard rate band works is that the lower earning spouse pays 20% tax on the lower of their gross or €20,400. The normal married standard rate band of €38,400 is then split as requested between the spouses. A simple case would be where one spouse earns €20,400 or less gross p.a. In this case that spouse would only pay 20% tax on their income and the other spouse would get the full married standard rate allowance of €38,400. Where both spouses earn more than €20,400 then the €38,400 is split whatever way benefits them most. On joint/aggregated married taxation this should happen automatically. The €20,400 increment is not transferrable so if on spouse earns less than €20,400 then the "unused" allowance cannot be transferred to the other spouse. Once gross tax at 20% and 42% has been calculated the relevant tax credits are subtracted to give net tax.
It might be easier to just plug the relevant figures into a [broken link removed] and check the results.