finance
HMRC Urges Higher Earners to Check High Income Child Benefit Charge Obligations
HM Revenue and Customs has issued a warning to parents earning over £60,000 annually to verify if they owe money under the High Income Child Benefit Charge. The charge requires repayment of some or all Child Benefit based on income levels between £60,000 and £80,000. Affected individuals can use a new digital service or PAYE adjustments to handle payments.
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HM Revenue and Customs (HMRC) issued a warning over the weekend on X, directing higher earners to check their obligations under the High Income Child Benefit Charge. The message stated: "Earning over £60k? " The charge applies to households where at least one partner earns above £60,000 while claiming Child Benefit.
Parents in this income bracket may need to repay a portion or the full amount of the benefit received, depending on their adjusted net income. This system has been in place to adjust Child Benefit eligibility for higher-income families.
Works The repayment operates on a sliding scale from £60,000 to £80,000.
For every £200 earned above £60,000, one percent of the Child Benefit must be repaid. For instance, an individual earning £67,600 would repay 38 percent of the benefit. Once income reaches £80,000, the full Child Benefit amount must be repaid.
Adjusted net income includes salary, savings interest, and dividends, calculated before personal allowances but after deductions like pension contributions and Gift Aid. If both partners exceed the threshold, the higher earner is responsible for the payment. 90 for each additional child.
40 annually. The benefit is available until a child turns 16, or up to age 20 if the child is in approved education or training.
HMRC has launched a digital service to simplify the process for those not registered for Self Assessment.
" Employees can opt for collection through PAYE, where HMRC adjusts the tax code to deduct the amount from wages, potentially avoiding a full tax return. This PAYE option must be arranged before January 31 of the year following the relevant tax year. Self-employed individuals or those already filing tax returns must complete Self Assessment.
