High Income Child Benefit Charge

conks

Hi,

We've had letters recently from HMRC confirming HICBC and explaining how it works. We have had a final reminder since.

Whilst we have stopped the claim (2 weeks ago) the problem is HMRC are asking us to disclose all from tax 2012 -2013 to 2017 - 2018.

I have not completed a SA in this period.

We had twins in Jan 2013. At that time I was earning under £50k albeit, and it will be hard to find out, I have changed jobs 4 times since. I will not be able to locate P60's for most of this time and I have a rough idea that from 2014 onward I was earning above £50k.

I'm trying to understand if we firstly need to return to HMRC with this information. Naively we're hoping that HMRC will forget about us given that we've cancelled the claim recently.

Assuming that they can easily check earnings (from P60's previous submitted etc.) & that they will pursue us I'm trying to understand what, worst case, we will be required to pay back.

I definitely know that I was earning in excess of £65k from 2014 onward.

Any help & guidance appreciated.

Thanks.

Dazed_and_confused

Naively we're hoping that HMRC will forget about us given that we've cancelled the claim recently.

:rotfl:

Assuming that they can easily check earnings (from P60's previous submitted etc.) & that they will pursue us I'm trying to understand what, worst case, we will be required to pay back.

I definitely know that I was earning in excess of £65k from 2014 onward.

Probably best to assume that worst case is you will have to pay all Child Benefit received from when the twice were born (coincidentally HICBC started in January 2013 when they were born).

You will need to factor in late payment interest charges which will apply to all years to 2017:18 (and from 1 February next year for 2018:19 if you have to pay it direct to HMRC). For example for anything owed for 2012:13 you will be charged interest from 31 January 2014 to the date you eventually pay the amount due.

If you aren't going to work with HMRC then don't be surprised if penalties are also imposed. In theory I think these can be 100% of the tax owed but doubt they would actually impose this for HICBC but who knows

You may be able to avoid having to pay the charge due for 2018:19 direct to HMRC by filing your 2018:19 by 30 December 2019 and opting for the amount due (assuming less than £3,000) to be collected by having a reduced tax code for 2020:21. This is effectively an interest free loan.

You cannot have anything due for 2017:18 or earlier tax years collected through your tax code.

If you have made personal pension payments to a "relief at source" pension scheme then these will reduce your adjusted net income, which the HICBC is based on, and may reduce the HICBC payable. You are highly unlikely to be able to deduct any other pension contributions as these will already be reflected in your P60 figures i.e. the P60 pay value will be lower than it would otherwise be.

Normallydebtfree

Hi I am in a similar situation. First of all Don't Panic. What has reduced the worry for me is replying to their letter by post acknowledging that I am in debt to them putting the ball in their court. After a delay I received a letter informing me that I had to complete a Tax return for the year 2018 to 2019 . At first this is daunting but you need to make a start. CAB may be able to advise on the wording of the letter. A sympathetic ear will allow you to remember bit by bit your employment history and enable a copies of your P60 to be generated.


Hope this helps. It is not advice IANAL.

badmemory

Remember that if your spouse does not work then actually cancelling your claim will prevent them from benefiting from the free NI credits. It is possible to just cancel taking the money!