Anyone had a letter from HMRC yet about Child Benefit Tax?

pleasedelete

I have a letter. I was slightly confused by it.

Does a child have to live with you to claim child benefit for them? If they live alone (but you pay their living expenses) can you still claim?

chrismac1

In my view numerous posters to this forum could learn from the following:

If you are not OK with people taking legitimate action to minimise their tax bills, do not be on a forum headed up "Cutting Tax".

zagfles

waccamole wrote: »

I experienced a genuine eye opener the other day on the debt forum. I'd never subscribed to the 'you're as well off on benefits as working' school of thought so was amazed to read someone's SOA which showed that with one low paid parent and one on JSA their net family income was a few pounds more than ours is.

My salary is over £50K.

I am the only earner in the family and we have one less child.

So, although £50K is a lot for a single person, when the net amount after tax and NI is supporting a family of five it is actually in the same ball park as the income the benefits system deems appropriate for that size of family.

Yes - try this tool from the IFS, which shows how your equivalised income compares to everyone else and the percentile you're at.

http://www.ifs.org.uk/wheredoyoufitin/

Note that you have to use net income, ie after tax, NI and benefits.

Equivialised income accounts for family size and uses the generally accepted equivalisation calculation used internationally, which is also used for the govt "child poverty" measures. It basically measures how rich your household is, accounting for its composition, compared to the rest of the country.

A family on a £60k single income (net income £41600) with 4 kids, two over 13, without child ben, would be well inside the lower half of the income scale, on the 38th percentile. ie the majority of the country are richer than them.

So much for the numpties who think this is a benefit cut just for the "rich".

waccamole

zagfles wrote: »

http://www.ifs.org.uk/wheredoyoufitin/

Thanks zagfles - really interesting!

John_Pierpoint

We do have the bizarre situation that the economic crisis since 2007 has lifted thousands of children out of poverty.
For as long a poverty is defined as less than 60% of median (average) income, reducing incomes reduces child poverty.

http://www.dailymail.co.uk/news/article-2233145/Child-poverty-broken-homes-money-insists-IDS-Troubled-families-need-cash-handouts.html

antonic

I totally agree with you !.

Tax planning is perfectly legal and if big companies like Amazon, Starbucks et al can do it so can the man on the street.

IMHO this is a half baked policy , thought up by some policy wonk in the Treasury, who has never had to do a REAL days work in their life and most probably will use every LEGAL artfiice under the sun to reduce their charge, but hasnt thought (or doesnt care ) about the effects on the man in the street.

HMRC have been sold a pig in a poke, and been told to get on with it and HMRC will be held responsible if its an another EPIC FAIL.

chrismac1 wrote: »

In my view numerous posters to this forum could learn from the following:

If you are not OK with people taking legitimate action to minimise their tax bills, do not be on a forum headed up "Cutting Tax".

zagfles

John_Pierpoint wrote: »

We do have the bizarre situation that the economic crisis since 2007 has lifted thousands of children out of poverty.
For as long a poverty is defined as less than 60% of median (average) income, reducing incomes reduces child poverty.

Yup - so called "child poverty" is simply a measure of the gap between the middle and the bottom. There are obviously two ways to close the gap, reduce the median, or increase the bottom. They are both equally effective at reducing the "child poverty" figure, so you get the stupid situation where poverty is reducing (because the median is reducing) but the poor aren't getting any better off.

It also explains why New Labour's policies weren't to take from the rich and give to the poor. They were very nice to their rich mates. Their policies took from middle income people and gave to the poor. Since this reduces the gap from both ends, and so is much more effective than taking off the rich and giving to the poor - which would only attack one end.

It was very clever of them to use median income rather than mean, using mean would have meant that all the massive rises the fat cats got under the last govt's time would count, as they increase mean income. But they don't increase the median.

The sooner this govt has the balls to ditch these stupid targets and put something actually related to real poverty in their place, the sooner we can get decent policies which are fair to everyone.

Make-it-3

Ever since this silly policy was announced it has been a piece of Swiss cheese. I agree, the poor sods at HMRC have enough to contend with.

I just don't understand why the Government (if it wanted to means test child benefit) didn't scrap it for everyone and roll it in Child Tax Credits / Universal Benefit.

Anon

Make-it-3 wrote: »

Ever since this silly policy was announced it has been a piece of Swiss cheese. I agree, the poor sods at HMRC have enough to contend with.

I just don't understand why the Government (if it wanted to means test child benefit) didn't scrap it for everyone and roll it in Child Tax Credits / Universal Benefit.

There was a claim that they needed to work through how to administrate it and as usual have come up with another new process to complicate it, but I would have thought that the systems were already set up with Family Tax Credit as that relied on income figures for both adults/parents at an address?

For a government that is trying to cut costs, it seems to be making a bit of a hash of it on a number of fronts with this, Police Commissioners (yesterday apparently cost £100 million just for the election :mad:), rail franchising (£40 million cost of process so far due to failed figures) - in fact many of the cost saving initiatives seem to be costing more and working less effectively than they did before (and I am in no way saying that it was working, efficient or effective before, so not making a political point).

Anon

lellow_lorry

We've had nothing from them.....which makes me think the whole thing is going to be an absolute horlicks. My salary has been above 60k for last four years so they should be able to work it out.
Any one in same boat, the Hmrc site has an online way of stopping it if its the easiest option for you. This saves filling out a tax return each year. Peace of cake to fill out ......on a side .....no issues stopping it but a couple on 100k still getting it? It's an insult to all.