MSE News: Budget 2012: what the child benefit overhaul means for you

sarahb

I think the relevant amount is gross salary after salary sacrifice (but before tax/NI) plus benefits in kind (company car, private healthcare etc), less pension contributions and certain union memberships.

JimmyTheWig

Jenni1022 wrote: »

Am I right in thinking that you have to earn over 50k before tax for the cuts in child benefit ?
Am confused by all of this

Yes, you need taxable income of £50k+ before you start to lose the benefit.
I.e. someone earning £51k before tax will pay extra tax because of their child benefit.
But someone earning £51k but making £2k pension contributions will have taxable pay of £49k and so will not lose any of their benefit in extra tax.

Does that help?

Flibsey

Do mothers who claim child enefit stil get their national insurance paid by the government too? (just thinking that IF there is a state pension when I am whatever age, I'd like to know I'm not going to lose out because they've stopped this side of CB payments)

axle123

royalsteve wrote: »

I earn £60600, I am not rich, far from it as i live in the south!! I drive a 10 year old peugeot. I have 2 kids to support and my wife doesnt and cant work. We havent been on a foreign holiday for 10 years as we cant afford it.

I voted conservative and ive just informed my out of touch mp that i wont be voting for his party again.

How is fair that a family with 2 working parents each on £49999 get the full Child Benefit, whereas those like us where one parent earns £60K and the other nothing, get nothing. What moron came up with that illogical policy!!!

The biggest problem is the scheme has changed, but the primary design flaw has just been shifted to 2 parents who can now earn £49,999 each and still get child benefit. Until the scheme considers whole household it is broken. I know someone will tell me, but how much less tax & NI do two people on £49,999 contribute compared to a single earner on £60-99k?

Why not make the change to total household income, but let "stay at home" mums pass on their unused tax allowance to the husband?

...to the person who commented on your statement "I am not rich", it does not take long before £400-500 food shopping, £230 council tax, diesel and all lifes other taxes erode into that net amount

cw18

Flibsey wrote: »

Do mothers who claim child enefit stil get their national insurance paid by the government too? (just thinking that IF there is a state pension when I am whatever age, I'd like to know I'm not going to lose out because they've stopped this side of CB payments)

The person who claims the Child Benefit (doesn't have to be the mother) gets protection for their pension until the youngest child is 12.

JimmyTheWig

Flibsey wrote: »

Do mothers who claim child enefit stil get their national insurance paid by the government too? (just thinking that IF there is a state pension when I am whatever age, I'd like to know I'm not going to lose out because they've stopped this side of CB payments)

The way the change will work is that child benefit can still be claimed in all cases.
So consider a family with a SAHM and a dad earning £55k.
The mum can claim child benefit. She will get paid the full benefit directly into her bank account (and so doesn't have to rely on her husband for money all the time) and she will get her national insurance credited.
The dad will then pay extra tax, equivalent to half the child benefit that the mum receives.

If he was earning £60k+ then the same would happen - she'd still claim the benefit but his tax would increase by the full amount of the benefit.

shedboy94

bromleymum wrote: »

Yes, absolutely, I take your point.

But we are taxed as individuals in this country based on what we earn, not on who we live with or whether we have children. But not now....now it matters for tax purposes how we lead our private lives.

And before anyone points out that it should matter and you should be taxed as a family then you can't have it both ways because we lost all tax breaks for being married and having children years ago.

Also, there is a still the debate about whether child benefit is a welfare benefit or a tax allowance. It is made via the tax office unlike all other benefits.

And it replaced the old family allowance and tax relief for having children.

I just think the tories have created a administrative nightmare. It's purely there so they can say "look, we're not just bashing the poor, we're taking money off the rich as well."

Not true, WTC and CTC are also administered by HMRC - they are benefits, not tax allowances

AirlieBird

shedboy94 wrote: »

Not true, WTC and CTC are also administered by HMRC - they are benefits, not tax allowances

Tax Credits are not benefits. The clue is in the name they are credits against tax.

Both Tax Credits and Child Benefit are included in the Government's calculation of the Tax Burden.

JimmyTheWig

AirlieBird wrote: »

Tax Credits are not benefits. The clue is in the name they are credits against tax.

But surely it is possible to receive more in Tax Credits than you pay in tax?

shedboy94

AirlieBird wrote: »

Tax Credits are not benefits. The clue is in the name they are credits against tax.

Both Tax Credits and Child Benefit are included in the Government's calculation of the Tax Burden.

They are benefits - how can it have anything to do with Tax if you don't work and receive CTC - you are not paying any Tax?