Should you be claiming Child Benefit again?

If you've previously avoided claiming Child Benefit because you or your partner’s income exceeded the £50,000 to £60,000 annual thresholds, now is a good time to think again and consider if a claim could be beneficial.

In the recent Spring Budget, the Government announced significant adjustments to Child Benefit thresholds. From April 2024, the annual threshold at which the High Income Child Benefit Charge (HICBC) starts to apply will increase from £50,000 to £60,000, with further changes in the repayment structure. As a reminder, this threshold is applied to the highest earner of the household.

Previously, the HICBC effected a 1% repayment of the benefits for each £100 earnt over £50,000. The new tapering rules imply only a 0.5% repayment for every £100 earnt over £60,000. With full repayment due where annual income reaches £80,000.

Take the example of someone with two children, claiming Child Benefit of £2,212 for the year from April 2024, earning £70,000 per year. Based on the old rules, they’d have to repay 100% of the benefit via a self-assessment tax return. In the new legislation, they’ll need to repay just 50% of the benefit (£1,106).

It may be that this benefit is now fully or partially available to you.

It’s crucial to be aware of the self-assessment tax return reporting obligations associated with the HICBC. We’d advise you to consider the monetary and time costs involved with submitting a tax return before a you make a claim for the benefit.

Given that each family's circumstances are unique, it's essential to review each case individually. However, this blog aims to prompt you to consider if you could now claim from Child Benefit.

We’re also expecting to see more changes in the future. A consultation has been opened which will examine whether to change Child Benefit eligibility to being based on household income, rather than on individual income. If these changes go ahead, we’d expect them to be in place by April 2026. This is aimed at stopping what many think is unfair, under the current rules, for single income families. 

Need help?

If you have any questions about this topic or any other way you could be saving tax, please get in touch with your usual contact at Larking Gowen, call 0330 024 0888 or email enquiry@larking-gowen.co.uk.

You can find contact details on the Our People section of the Larking Gowen website.

Jordan Smith