Thousands of households receiving Child Benefit can now settle the high income tax charge using their tax code for the first time. Child Benefit amounts to £26.05 weekly for the first child and £17.25 for each subsequent child. Eligibility for Child Benefit is based on caring for a child, but high-income earners may need to repay a portion based on their earnings.
Individuals earning over £60,000 must repay 1% of their Child Benefit for every £200 over this threshold, referred to as the High Income Child Benefit Charge. Once earnings exceed £80,000, the entire Child Benefit must be repaid. Previously, the high income charge was settled through self-assessment, but now there is the option to pay it via the PAYE tax code.
To join the Mirror’s Money WhatsApp community for the latest HMRC updates and money-saving tips, click the provided link and select ‘Join Chat.’ This service allows employed individuals who do not require self-assessment for other reasons to have the charge deducted from their pay.
The deadline to opt in for the 2024/25 tax year, ending on April 5, 2025, is January 31, 2026. Those who already file self-assessment cannot use the PAYE option. High-income households can claim Child Benefit without receiving payments to secure National Insurance credits for their state pension without incurring the charge.
Child Benefit is available to over seven million families responsible for children under 16 or under 20 in approved education or training. The child must reside with the claimant, and the claimant must contribute at least the same amount as Child Benefit toward the child’s care. Child Benefit can also be claimed when fostering a child not supported by the local council or when adopting a child.
Dan Tomlinson, Exchequer Secretary, highlighted the simplification of tax processes by modernizing HMRC. Parents signing up will receive a new tax code reflecting the deduction for the High Income Child Benefit Charge, with adjustments made in real-time based on income and entitlement changes.
