Do you know about the high income Child Benefit tax charge?

In January 2013 the rules around Child Benefit were changed. A tax charge was introduced for individuals with an income of over £50,000 per year. Prior to this the individual’s income was not taken into account.

The website has provided a Child Benefit tax calculator to help high earners work out how much they may need to pay.

If you do fall into this category you will need to submit a self-assessment tax return to inform HMRC. It can then be paid in one go or through your tax code on payroll if you are employed.

What’s the benefit?
The extra tax you pay may cancel out some or all of your child benefit, so it may be worth considering whether or not to stop the benefit all together. If you do decide to go with this option you should still fill in the claim form as this will help you to get National Insurance credits towards your state pension.

Perhaps there is potential for you to avoid the charge? For example you may be able to reduce your taxable income. There are various ways that this could be achieved so it may be worth taking financial advice to see what your options are.


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