Child Benefit Frozen?

loucroft

Nope, they aren't earnings - money you owned already that you don't 'earn' so no concerns in that respect

L

MR_BLAND

Hi,

My wife's salary is just below the magic £42,375/annum BUT if she does overtime it pushes it over. We have kids aged 6, 4 and 10 months.


I have three questions that I'm not sure about, i realise that fine details have not yet been published but do people have any suggestions.

1. What tax year will the decision be based on? Is she going to have to keep below the high rate tax after April this year so as not to lose benefits in 2013, would there be a claw back if she went over it in 2013?

2. I realise that the gross figure of £42,375/annum has been discussed, but as childcare vouchers and pensions are deducted before tax she is actually some way off paying higher rate tax at all! Does this mean benefits would not be effected?

3. Any guesses how this would effect the longer term - i.e. lose benefit now and you'll have to re apply every year if situation changes?

Any help appreciated
Thanks

zagfles

MR_BLAND wrote: »

Hi,

My wife's salary is just below the magic £42,375/annum BUT if she does overtime it pushes it over. We have kids aged 6, 4 and 10 months.


I have three questions that I'm not sure about, i realise that fine details have not yet been published but do people have any suggestions.

1. What tax year will the decision be based on? Is she going to have to keep below the high rate tax after April this year so as not to lose benefits in 2013, would there be a claw back if she went over it in 2013?

2. I realise that the gross figure of £42,375/annum has been discussed, but as childcare vouchers and pensions are deducted before tax she is actually some way off paying higher rate tax at all! Does this mean benefits would not be effected?

3. Any guesses how this would effect the longer term - i.e. lose benefit now and you'll have to re apply every year if situation changes?

Any help appreciated
Thanks

From what I've heard the govt say it seems nobody will lose the right to claim CB, but they will somehow reclaim it through the tax system if you pay 40% tax. But there's no details yet - maybe they'll announce them in the budget in March. Till then it's all guesswork. But I would guess that any tax deductible stuff like pensions etc which take you below the 40% rate should mean you aren't affected.

Personally I doubt it'll happen at all - or if it does it'll be watered down eg only apply if the individual claiming CB pays 40% tax (which would effectively mean where both parents pay 40%)

slummymummyof3

I thought there had been talk about the government looking at the figures again as the arguement had been put forward that it wasn't fair to stop CB in some higher tax payer circumstances - you could have two parents both earning in the higher rate tax bracket and another family where only one earner is working and earning in the higher tax bracket whilst other parent remains at home to look after the children........I'm sure I have read this somewhere?????

keith1950

Yes ,but interest on savings is 'income' and is taken into account by the inland revenue for tax purposes and taken into account for most other benefits so why not in this case. If one partner gets over £42,375 in interest then they must have savings of well over £1,000,000 so shouldn't get any benefits but if any savings were split in different bank accounts so both partners had less than £4,2375 interest each they should be ok although any couple with savings of over £2,000,000 shouldn't really be getting child benefit. It's the same as the motability scheme, why should a millionaire get a free car just because they are disabled. The country is in such a mess that all benefits should now be means tested.

sandraroffey

claim it back through the tax system?? a bit like how it used to be then; getting tax relief for children. then mrs thatcher changed it all.