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

schoolrunmum

Had my letter last week,we have no "earnings" as such,as we live off savings we drip feed into our current a/c....will HMRC class this as earnings?? We have already paid tax when we earned it, then saved it....now are we to be taxed again??? !!!!!!..

zagfles

Notjustamum wrote: »

Season ticket costs are not tax deductable but charitable donations are. My understanding was that the new rules only affect child benefit from January 2013 but that is only my understanding....

Yes it's only child benefit from Jan 2013 which will have to be repaid. But the income used to work out how much to repay is the income over the whole tax year.

zagfles

schoolrunmum wrote: »

Had my letter last week,we have no "earnings" as such,as we live off savings we drip feed into our current a/c....will HMRC class this as earnings?? We have already paid tax when we earned it, then saved it....now are we to be taxed again??? !!!!!!..

No because that's not taxable income. Unless you have taxable income from your savings of over £50k (eg interest, dividends etc) you won't be affected.

DitsyDaisy_2

Hi, thanks for the replies, well the person at SA Helpline sounded a bit confused so I wondered if I would get a clearer answer from the posters here. Its a scary business, we were wondering where we would find one lot of extra money but not two lots due to repayments!! I would love to start putting the child benefit into a savings account in case they ask for a lump sum... but it pays the bills unfortunately. God knows how people with lower income are managing, we've never eaten so much rice and pasta in our life. The kids have started asking who is coming to visit when they see meat going in the oven... thanks to you kind people for the help you bring worried folk.May the New Year bring us all happier times...

MoneySavingMuppet

Still no letter from HMRC. Given my (frozen for the last 3 years) salary, I reckon I'm due one.

Could having a surname near the end of the alphabet be the answer? Could being in Scotland?

Is there a HMRC helpline to call for advice on this?

chrismac1

Beware they are razor sharp! NOT ! (wink wink!)

My second last enquiry was into "false self-employment" in one of their "keenly targeted sector-wide investigations".

two Muppets were doing a 180 mile round trip on the Monday. On Thursday I aksed why they'd picked my client. They told me.

Me: "Do you realise all 23 staff are on PAYE and they paid £18k in tax and NI last tax year?"

HMRC: "Did they?"

DID THEY! Two inspectors taking 1 day out, 180 miles, my clients having to drop everything for one day and the numpties had not even realised everything with this company was PAYE.

The following day they rang to cancel the visit having checked the £18k was correct.

You can't make this stuff up!

spaine

http://www.hmrc.gov.uk/childbenefitcharge/howworks.htm

Charge on income of £50,000 to £60,000

The tax charge will be 1 per cent of the Child Benefit paid for every £100 of income between £50,000 and £60,000.
The tax charge will be less than the total amount of Child Benefit.
Example

Your individual adjusted net income is £54,000. You are entitled to Child Benefit for two children of £438 for the period from 7 January 2013 to 5 April 2013.
Your tax charge will be worked out as follows:
Step one: income over £50,000 = £4,000
Step two: determine the percentage rate to be applied to the result from step one, so £4,000 ÷ 100 = 40 (%)
Step three: £438 x 40% = £175
'Your tax charge will be = £175


Hope that helps

John_Pierpoint

chrismac1 wrote: »

Beware they are razor sharp! NOT ! (wink wink!)

Reminds me of an acquaintance who used to collect interesting bits of stone etc from architectural salvage yards and then custom build fire places for individual houses.

Two VAT inspectors over two days tried unsuccessfully to prove it was time to register for VAT. Somewhat galling if your main capital asset is a battered pick and your visitors seem to be in the sharp suit and company car bracket and add value to nothing.

Anyway back onto thread topic ......................

apcorbett

spaine wrote: »

http://www.hmrc.gov.uk/childbenefitcharge/howworks.htm

Charge on income of £50,000 to £60,000

The tax charge will be 1 per cent of the Child Benefit paid for every £100 of income between £50,000 and £60,000.
The tax charge will be less than the total amount of Child Benefit.
Example

Your individual adjusted net income is £54,000. You are entitled to Child Benefit for two children of £438 for the period from 7 January 2013 to 5 April 2013.
Your tax charge will be worked out as follows:
Step one: income over £50,000 = £4,000
Step two: determine the percentage rate to be applied to the result from step one, so £4,000 ÷ 100 = 40 (%)
Step three: £438 x 40% = £175
'Your tax charge will be = £175


Hope that helps

Interesting terms here... Your individual adjusted net income is £54,000.

I thought it was GROSS income rather than net - If it is net, then I'm easily under that, but if it is GROSS, then I'm not far away...

Anon

apcorbett wrote: »

Interesting terms here... Your individual adjusted net income is £54,000.

I thought it was GROSS income rather than net - If it is net, then I'm easily under that, but if it is GROSS, then I'm not far away...

My understanding is it is net as you need to take off any existing pension, childcare vouchers etc to arrive at your net taxable salary.