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  • FIRST POST
    • keepthelinguini
    • By keepthelinguini 9th Aug 17, 2:42 PM
    • 5Posts
    • 1Thanks
    keepthelinguini
    High Income Child Benefit Charge
    • #1
    • 9th Aug 17, 2:42 PM
    High Income Child Benefit Charge 9th Aug 17 at 2:42 PM
    I'm so annoyed. I've just received a big bill from HMRC and been told I'm going to pay a penalty, and I think it's completely unjust.

    I'm a PAYE employee.

    In 2013 when the High Income Child Benefit Charge was introduced I earned under the £50,000 threshold - so the change in rules didn't apply to me.

    Since then my income has gone slightly over £50,000.

    I've just received a bill for well over £1k for missed HICBC in the two years ending 2015 and 2016. I called them to query, and they said I should have registered for self assessment when my income went over £50k, and that I'll be charged a penalty on top of the amount I owe - around £250 - for failing to notify them.

    HOW was I supposed to know I need to start filling out a tax return when my income went above £50k?

    I'm planning to appeal the penalty, but the lady in the call centre told me that it would fail because you can't claim ignorance of the rules.

    IT'S SO UNJUST!

    If anyone has any advice, I'd be very pleased to hear it.
Page 1
    • TheCyclingProgrammer
    • By TheCyclingProgrammer 9th Aug 17, 3:35 PM
    • 2,574 Posts
    • 1,437 Thanks
    TheCyclingProgrammer
    • #2
    • 9th Aug 17, 3:35 PM
    • #2
    • 9th Aug 17, 3:35 PM
    You don't have any grounds for appeal I'm afraid so you're wasting your time. Ignorance is not an excuse.

    The higher rate benefit charge was well publicised. It's your responsibility to notify HMRC when your income crosses the threshold and submit a self assessment.

    Sorry if that's not what you wanted to hear. You may be able to arrange a payment plan with HMRC if you can't afford the repayments now.

    Don't forget if you're still earning above the threshold you'll need to submit a tax return for the previous tax year by the end of Jan 2018.
    • purdyoaten2
    • By purdyoaten2 9th Aug 17, 3:40 PM
    • 614 Posts
    • 271 Thanks
    purdyoaten2
    • #3
    • 9th Aug 17, 3:40 PM
    • #3
    • 9th Aug 17, 3:40 PM
    I am not sure how anyone on here can help you as there was a huge publicity campaign about this when our dear Mr Osborne introduced this in January 2013. I hope your appeal is successful but, unless you come up with some other good reason, you are doomed to failure.

    It doesn't help matters but it should be stated that the one organisation who was aware of your salary was HMRC as your employer is required to notify them electronically each time that you receive a salary payment. You can make your own judgment as to why it has taken two years to catch up with you in respect of 2014/15 tax year.
    purdyoaten lost his password
    • keepthelinguini
    • By keepthelinguini 9th Aug 17, 3:42 PM
    • 5 Posts
    • 1 Thanks
    keepthelinguini
    • #4
    • 9th Aug 17, 3:42 PM
    • #4
    • 9th Aug 17, 3:42 PM
    Thanks for this - I fear you're right.

    But it two years after the change that my income changed. It's such an obscure thing to have to remember, particularly if you're PAYE.

    What, for example, if I wasn't yet working in 2013 and this year I go above £50,000? Or what, for example, if I wasn't in the country in 2013? I think it's completely unreasonable for HMRC to expect people to know automatically that they have to start submitting tax returns without being notified.
    • keepthelinguini
    • By keepthelinguini 9th Aug 17, 3:45 PM
    • 5 Posts
    • 1 Thanks
    keepthelinguini
    • #5
    • 9th Aug 17, 3:45 PM
    • #5
    • 9th Aug 17, 3:45 PM
    I am not sure how anyone on here can help you as there was a huge publicity campaign about this when our dear Mr Osborne introduced this in January 2013. I hope your appeal is successful but, unless you come up with some other good reason, you are doomed to failure.

    It doesn't help matters but it should be stated that the one organisation who was aware of your salary was HMRC as your employer is required to notify them electronically each time that you receive a salary payment. You can make your own judgment as to why it has taken two years to catch up with you in respect of 2014/15 tax year.
    Originally posted by purdyoaten2
    People keep mentioning this huge publicity campaign. I really don't remember it. It was years ago!
    • 00ec25
    • By 00ec25 9th Aug 17, 6:24 PM
    • 4,529 Posts
    • 3,911 Thanks
    00ec25
    • #6
    • 9th Aug 17, 6:24 PM
    • #6
    • 9th Aug 17, 6:24 PM
    People keep mentioning this huge publicity campaign. I really don't remember it. It was years ago!
    Originally posted by keepthelinguini
    have you read the thread from someone else also caught like you and wailing about the rules of self assessment?

    http://forums.moneysavingexpert.com/showthread.php?t=5691477

    post#3 many help jog your memory?

    • keepthelinguini
    • By keepthelinguini 9th Aug 17, 6:38 PM
    • 5 Posts
    • 1 Thanks
    keepthelinguini
    • #7
    • 9th Aug 17, 6:38 PM
    • #7
    • 9th Aug 17, 6:38 PM
    have you read the thread from someone else also caught like you and wailing about the rules of self assessment?

    post#3 many help jog your memory?
    Originally posted by 00ec25
    That was 4 years ago, and I wasn't earning enough money for it to be relevant to me at the time. Years later, I discover I'm supposed to have been filling out a tax return when my income went over the arbitrary £50k line, with no nudge from HMRC, and then I receive a penalty for it. This is not a way to run a tax system.

    I also wonder at what point HMRC decides they need to start informing people. After all next year that 'publicity campaign' (a few articles in newspapers) will be 5 years old.

    It's totally unfair.
    • keepthelinguini
    • By keepthelinguini 9th Aug 17, 6:54 PM
    • 5 Posts
    • 1 Thanks
    keepthelinguini
    • #8
    • 9th Aug 17, 6:54 PM
    • #8
    • 9th Aug 17, 6:54 PM
    have you read the thread from someone else also caught like you and wailing about the rules of self assessment?

    post#3 many help jog your memory?
    Originally posted by 00ec25
    Also ... I'd point out that only one of those links says anything about having to register for self assessment if you're on PAYE, and that's a specialist accountants website.
    • xylophone
    • By xylophone 9th Aug 17, 9:02 PM
    • 22,325 Posts
    • 12,883 Thanks
    xylophone
    • #9
    • 9th Aug 17, 9:02 PM
    • #9
    • 9th Aug 17, 9:02 PM
    All I can say is that (even though the legislation didn't affect me as I was not a CB claimant) I was concerned enough about the single/dual income aspect to write to my MP at the time...

    http://webarchive.nationalarchives.gov.uk/20141007023213/http:/www.hmrc.gov.uk/budget2012/tiin-0620.pdf


    Are you really claiming that you did not know about the higher earner CB charge?

    Or that you were unaware that an increase in income should be advised to HMRC?

    https://www.gov.uk/report-changes-child-benefit
    Last edited by xylophone; 09-08-2017 at 10:58 PM. Reason: typo
    • kidmugsy
    • By kidmugsy 9th Aug 17, 10:52 PM
    • 9,444 Posts
    • 6,223 Thanks
    kidmugsy
    I suppose hmrc think that if you are capable of earning £50k p.a. you should be capable of behaving like an adult. Such sunny optimists.
    • StevenO
    • By StevenO 11th Aug 17, 12:02 PM
    • 17 Posts
    • 4 Thanks
    StevenO
    Same issue here, a four / five year old campaign or piece on the news that wasn't even relevant to me back then I can not be expected to recall.

    I was chatting to my wife about another unrelated tax issue when we registered in their online portal recently, this led to us to look into a few other things and I discovered the 50k limit.

    I've now registered for self assessment and waiting to hear back.

    In my simple world when I am PAYE my employer notifies HMRC of my earnings each month and submits my end of year P60 on my behalf. My tax is adjusted by the payroll department in accordance with how much I need to pay, and I'd expect HRMC to question something if there is an issue (seeing as they already have all of my earnings and contributions on their system).

    I have never been self employed or had to deal with tax returns as I have always been PAYE.

    It's sheer luck that I found out that I owe the tax man money now. I could also have been subjected to a surprise letter and a penalty.

    From what I read the system is a shambles anyway. One person could earn 58k, and be the only earner in his household and have to pay it all back or his partner not be entitled to family allowance. Yet compare this to the couple next door earning 50k each having nearly double the income and they are still entitled to claim the full amount.
    • StevenO
    • By StevenO 11th Aug 17, 12:07 PM
    • 17 Posts
    • 4 Thanks
    StevenO
    I suppose hmrc think that if you are capable of earning £50k p.a. you should be capable of behaving like an adult. Such sunny optimists.
    Originally posted by kidmugsy
    "behaving like an adult"?

    The OP has had a nasty surprise with the tax bill, something easily done if you have been PAYE all of your life and expect both the payroll department of your company and the tax man to have his house in order, seeing as both have accurate records of your earnings and contributions. It really shouldn't be an individuals responsibility to chase the tax man when they already have been presented with all of the information and facts.

    And not everyone is interested in Tax, self employed, or dealing with other sources of income that warrant investigation into tax and or self assessment.

    I imagine there have been quite a few people caught out by this.
    • xylophone
    • By xylophone 11th Aug 17, 3:38 PM
    • 22,325 Posts
    • 12,883 Thanks
    xylophone
    It really shouldn't be an individuals responsibility to chase the tax man
    It is the individual's responsibility to check that he is paying the correct amount of tax and to advise HMRC if he isn't.

    Same issue here, a four / five year old campaign or piece on the news that wasn't even relevant to me back then I can not be expected to recall.
    You knew that there was legislation relating to CB and higher earners.


    You ( your wife) claims CB.

    You knew that your salary had increased - it was your responsibility to check whether or not you were affected.

    Not having a car at the time MOT legislation was introduced and so being unaffected by the matter would not exempt you from remembering about it once you had a vehicle.

    From what I read the system is a shambles anyway. One person could earn 58k, and be the only earner in his household and have to pay it all back or his partner not be entitled to family allowance. Yet compare this to the couple next door earning 50k each having nearly double the income and they are still entitled to claim the full amount.
    Post 9 - many people disagreed with the legislation.

    But that is immaterial to the issue of personal responsibility for compliance.
    • Dazed and confused
    • By Dazed and confused 11th Aug 17, 10:14 PM
    • 1,594 Posts
    • 681 Thanks
    Dazed and confused
    StevenO

    This part of your post would suggest you haven't understand how the High Income Child Benefit Charge actually works.

    One person could earn 58k, and be the only earner in his household and have to pay it all back
    • Wayne O Mac
    • By Wayne O Mac 12th Aug 17, 4:41 PM
    • 203 Posts
    • 252 Thanks
    Wayne O Mac
    There's plenty wrong with the UK tax system, but it's not "unfair" just because someone is too stupid to pay attention to their affairs and responsibilities.
    • fiisch
    • By fiisch 14th Aug 17, 11:35 PM
    • 113 Posts
    • 33 Thanks
    fiisch

    From what I read the system is a shambles anyway. One person could earn 58k, and be the only earner in his household and have to pay it all back or his partner not be entitled to family allowance. Yet compare this to the couple next door earning 50k each having nearly double the income and they are still entitled to claim the full amount.
    Originally posted by StevenO
    This really grinds my gears! I've just gone PAYE having been a contractor for a short period and on a salary of £59k. My wife will be part time (earning >£10k / year) when she returns from maternity leave, so we didn't bother claiming child benefit initially.

    Then I realised that additional pension contributions would be deducted from my total, so I'm now claiming contributing 5% of my income via AVCs to reduce my take-home pay (makes sense as my employer does have a match scheme of sorts). I would contribute more but we can't afford to, as contrary to what the government thinks £59k is not a high income for a family in the south east.

    So what is the process when the tax year ends? I'm supposed to register for self-assessment, fill out how much I've earned (presumably from my P60) and submit to the tax man, to be told how much I have to pay back?

    Ironic that people who can afford to have kids and are of a generation which has already been stiffed for student loans now lose child benefit (especially when it's judged on individual as opposed to joint income), but that's a whole other conversation...!!
    • xylophone
    • By xylophone 15th Aug 17, 1:27 AM
    • 22,325 Posts
    • 12,883 Thanks
    xylophone
    See tax planning in

    http://www.pruadviser.co.uk/content/knowledge/technical-centre/child_benefit_trap/

    https://www.gov.uk/child-benefit-tax-charge/overview
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