Child Benefit change – one week to go

Child Benefit change – one week to go

HM Revenue and Customs (HMRC) is today reminding high-earning Child Benefit recipients that they have until 6 January 2013 to decide whether to stop receiving the benefit.

The High Income Child Benefit Charge (HICBC) starts on 7 January. The new charge will apply when a taxpayer or their partner’s income is more than £50,000 in a tax year, and if they or their partner receive Child Benefit.

Lin Homer, HMRC’s Chief Executive, said: “Over 155,000 people have already decided to stop receiving Child Benefit. There is easy to use information and a calculator on our website which will help families come to a decision.”

For those with income of more than £60,000, the tax charge is 100 per cent of the amount of Child Benefit. For income between £50,000 and £60,000, the charge is gradually increased to 100 per cent of the Child Benefit.

Those affected will need to decide whether to keep receiving Child Benefit and pay the tax charge through Self Assessment, or to stop receiving Child Benefit and not pay the new charge. If a couple wish to stop receiving the benefit, the Child Benefit recipient should contact HMRC before the new charge starts on 7 January. If their income is less than £60,000, the tax charge will always be less than the amount of Child Benefit, so they could lose money to which they are entitled if they choose to stop receiving Child Benefit.

For more information go to http://www.hmrc.gov.uk/childbenefitcharge

HMRC will hold a live twitter Q&A on the High Income Child Benefit Charge on 3 January 2013 between 10.30am and 11.30am #hicbcqa