Date posted: 1st May 2024
For many years now, child benefit has been repayable to HMRC, if one person in a household receiving child benefit, earns over £50,000.
Once that person earned over £60,000 the benefit was fully repayable to HMRC.
Given that this meant that the individual would need to complete a tax return, many families opted out of receiving child benefit. However, following changes introduced from April 2024, it may be worthwhile re-claiming the benefit.
The changes mean that the repayment of any child benefit, is not considered until the highest earning individual in the household receives more than £60,000 of income. In addition, the tapering impact means that it is only fully repayable when that individual earns over £80,000.
Therefore, it could be worthwhile considering reclaiming the family child benefit entitlement.
You can do this on the goverment website here: https://www.gov.uk/child-benefit-tax-charge/restart-child-benefit
You must still notify HMRC that some or all of the child benefit is repayable i.e., you earn between £60,000 and £80,000 but this could be in a future tax year.
The definition of earnings includes all sources of income but there may be additional relief for payments such as pension contributions and gift aid donations.
As ever, if you need assistance with your tax return, to declare child benefit, please give us a call.
