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High Income Child Benefit Charge

If you or your partner receive Child Benefit payments and either of you have an individual income over £50,000, you may be liable to pay a High Income Child Benefit Charge (HICBC).

The amount of the charge depends on the level of your adjusted net income for each tax year:

  • If your income is between £50,000 and £60,000, for every £100 of your income that exceeds the £50,000 the HICBC is equal to 1% of the Child Benefit received.
  • If your income is over £60,000, the charge will be equal to the full amount of the Child Benefit received.

Partners include someone you are married to, in a civil relationship with, or living with as if you are (as long as you are not permanently separated). It is the individual with the highest income that pays the charge and it’s based on their individual income that the charge is calculated.

If you or your partner’s income is over the threshold, you can choose to either receive your Child Benefit payments and pay the charge through your Self Assessment tax return or you can ‘opt out’ of your Child Benefit payments and avoid paying the HICBC.

If the HICBC is not accurately recorded on an individual’s return, HMRC will charge late payment interest and can also charge inaccuracy penalties for filing an incorrect tax return.

You can check whether you are over the £50,000 limit on the GOV website page, but if you need assistance with your tax return, or any other tax related matter, please get in touch with our EQ Taxperts by calling one of our offices or emailing [email protected].

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