Parents have been urged to check if they’re over the threshold
Parents who have recently been given pay rises are being reminded to check if they now fall above the threshold for the High Income Child Benefit Charge. This may mean they owe money to HMRC, depending on how much they earn.
The Department posted a reminder on X, urging parents to find out if they need to pay back some of the benefit and how to do it. The more your income goes over the threshold, the more of the benefit you’ll have to give back to the Government.
If you or your partner earns more than £60,000 a year, you’ll need to pay back a proportion of your Child Benefit payments. But if you or your partner’s income hits £80,000 or more, you’ll have to repay the full amount.
It’s worth noting this is based on individual income, not combined household income. If both you and your partner earn over the threshold, the person with the higher income will be responsible for paying the charge.
For people whose earnings exceed the threshold, two options are available; you can continue claiming Child Benefit and pay the tax charge through either PAYE or a Self Assessment tax return.
The most suitable approach will depend on your overall financial circumstances – for example, those who are self-employed must use the Self Assessment method.
Alternatively, you may decide to stop receiving Child Benefit payments entirely. However, this doesn’t mean your claim is completely cancelled, as the benefit also grants additional entitlements such as National Insurance credits, which will remain in place.
These credits count towards your state pension and can be extremely valuable for people who aren’t working or aren’t earning enough to pay National Insurance contributions while raising children. To receive the full new state pension, you’ll require around 35 years’ worth of these credits or contributions.
Even if the credits aren’t necessary for you personally, you might be able to transfer them to your partner. The Gov.uk website includes a Child Benefit tax calculator, which can help people determine how much of their Child Benefit payments they’ll be required to repay if their income surpasses the threshold.
Child Benefit rates: £27.05/week for your first child £17.90/week for each additional child For families with a single eligible child, this equates to £104.20 each month. To qualify for Child Benefit, you must be caring for a child under 16 years of age, or under 20 if they’re engaged in approved education or training.
You’ll also need to be living in the UK, and the child must either reside with you, or you must provide financial support towards their upbringing roughly equal to the benefit amount you’d receive.
Just one person can claim Child Benefit for each child, although there’s no limit on how many children you can make claims for. Submitting a Child Benefit application will automatically generate a National Insurance number for your child, eliminating the requirement for a separate request. This number will generally be sent to them just before their 16th birthday.
