Higher child benefit charge - scared

Pugs2411

Hi,

My partner has today received a higher child benefit charge totally £1400 for 2015 and 2016.

Hands up, We completely forgot to register when he went into the 50k bracket (he was subsequently made redundant in 2016)

We can just about manage the £1400 but they are saying there will be interest and penalties to pay - I am so scared that we will have to pay thousands, really getting upset.

Does anyone know how they work out the interest?

Please please help

[Deleted User]

I don't know but someone might come along here tomorrow who does, you may be able to agree to make payments if you can't afford the full amount in one go

Pugs2411

Thanks. I hope so, I've not slept through worrying

Darksparkle

Interest is pretty small to be honest. It's a tiny percentage of the tax owed, sorry can't remember the exact figure but it's on gov.uk somewhere or he can check his SA statement.

Info on penalties here - https://www.gov.uk/government/uploads/system/uploads/attachment_data/file/677811/CC-FS11__01_18.pdf

Dazed_and_confused

According to gov.uk late payment interest rates have been either 2.75% or 3% in recent years.

https://www.gov.uk/government/publications/rates-and-allowances-hmrc-interest-rates-for-late-and-early-payments/rates-and-allowances-hmrc-interest-rates

So if the £1,400 tax due was for 2014:15 (it isn't clear from the op exactly what is due for which year(s)) then interest would be due I think from 1 February 2016.

£1,400 x 3% = £42/year

The tax is about 26 months late so it would be around £90 in interest if the tax was all due to be paid as far back as 31 January 2016.

Interest is charged on a daily basis so he sooner you get it paid the smaller the charge will be.

AdamBrunt

Pugs2411 wrote: »

Hi,

My partner has today received a higher child benefit charge totally £1400 for 2015 and 2016.

Hands up, We completely forgot to register when he went into the 50k bracket (he was subsequently made redundant in 2016)

We can just about manage the £1400 but they are saying there will be interest and penalties to pay - I am so scared that we will have to pay thousands, really getting upset.

Does anyone know how they work out the interest?

Please please help

We got the same letter over the weekend (for the same years - looks like HMRC have just run a job to send out letters en masse. Such a shame they don't just run the same job every year rather than wait 3 years as I am sure most people who get the letter could pay the amount if spread over 3 years 1/3 at a time).

I phoned them this morning; the guy I spoke mentioned nothing about interest to me but did mention the late penalties [ the later of which is clearly mentioned on the letter ]. The penalty can range anywhere between 10% and 30% of the charge depending on how you answer questions you get asked when you phone up. In your case, I am assuming the penalty therefore will be at least £140

Once you phone them up they will write to you again with the final amount payable (and how you can pay) after they have, effectively, filed a self assessment return automatically for your partner for the two years in question. The guy I spoke to gave me no indication of how long that would take.

Hope that helps.