High Income Child Benefit Charge Changes
7th April 2025
In an effort to simplify High Income Child Benefit Charge (HICBC), HMRC will allow HICBC to be paid, via the tax code from 2025. This means that employed individuals receiving Child Benefit will may no longer need to register for self assessment.
Who Will This Benefit?
Employed individuals earning over £60,000, who are in receipt of Child Benefit, will be able to report their position through a new HMRC Online Service.
They will be able to opt to pay the charge directly through PAYE, without the need to register for self assessment just to report and repay a small amount of Child Benefit.
This should come as a relief for earners caught by the HICBC system, which has previously caused confusion and countless tax tribunals, with many of the individuals targeted unaware that they were due to pay any charges.
What Do I Need to Do?
Parents will need to register to use the online service from Summer 2025, according to the Spring Statement documentation.
More information will follow when it’s available.
I’m in Self Assessment – Can I Benefit From This?
If you have any additional sources that are required to be reported through self assessment, this will not replace your Tax Return.
The measure will, however, pre-populate the information into self assessment tax returns for those outside of the PAYE system.
Please get in touch with your Tax Manager, should you wish to discuss your position further.
High Income Child Benefit Charge (HICBC) – A Reminder
Parents earning under £60,000 a year are eligible for the full amount of Child Benefit. Once you, or your partner’s income exceeds this amount, you have to start paying it back through the High Income Child Benefit Charge (HICBC).
At this point, you have to pay back 1% of your Child Benefit payment for every £200 of income you earn above £60,000 a year. Therefore, if you earn over £80,000, you’ll need to pay back all of the benefit.
Other Proposed Changes
The Labour government will not be continuing the review to change the HICBC charge to household income.
Get In Touch
Please speak to your usual Whitings contact or your local Whitings office if you would like more advice on this topic.
Disclaimer - All information in this post was correct at time of writing.
