HMRC has urged parents earning between £60,000 and £80,000 to claim their Child Benefit, since high earners are still eligible. From the tax year 2024 to 2025 onwards, people who earn less than £80,000 a year can earn the benefit, though they have to pay some back.
It aims to help families raise their children, and eligible families can earn £26.05 per week for the eldest or only child, and £17.25 for each additional child until they are 16, or 20 and in approved education or training. HMRC announced on X: “If you or your partner earn between £60,000 and £80,000, you can still claim Child Benefit. Our new digital service lets you pay the High Income Child Benefit Charge through your salary – no tax return needed. “
Earners pay back 1% of their Child Benefit for every £200 earned over the £60,000 threshold. For example, if your adjusted net income is £67,600 this is £7,600 over the threshold – or 38 lots of £200 – so you’ll pay back 38% of your Child Benefit.
This can be paid back through your paycheck or through a tax self assesment, or you can just opt out of the payments.
For example, dual-income families earning £59,000 each, with a household income of £98,000, may not be liable to the charge, but a single parent earning over £60,000 could be.
After significant pressure, the Conservatives committed in the 2024 Spring Budget to reform the system, with plans to move to a household-based assessment by April 2026. But since taking office, Labour has scrapped this.
Despite acknowledging the current system penalised single-earner households, it said the reform would be too costly to implement.
Treasury analysis suggested it would cost around £1.4billion by 2029-30 if the threshold was increased to between £120,000 and £160,000, so two adults could earn between £60,000 and £80,000.
