High Income Child Benefit Charge

HappyHarry22

Hi, I received a letter last week from HMRC advising that I may owe High Income Child Benefit Charge.  It was the first I'd ever heard of such a charge.  We have 2 children aged 8&6.  My wife claimed on our behalf back in Jan 2013 and at the time there was no such thing or any mention of it in the pack we received from hospital.  It was a long time ago but I distinctly remember being encouraged to apply for it.  I also remember being surprised it wasn't means tested.
It seems that the 'High Income Benefit Charge' was introduced at sometime in Jan 2013 but we were never informed of it.  I have the original letter which states a large list of changes in circumstances that we must advise HMRC on but it does not mention income at all.
Anyway since then we have received nearly £12k of Child Benefit and without our knowledge it appears that I should have been filling a self assessment tax return and paid £6k high income child benefit charge.  That's a serious bad surprise!
When I spoke to them on the phone they said that a lot of people were in the same position.  They say that at the time of the change they put messages in the press but as someone who doesn't read newspapers (especially when they have a new born) we never saw it.  I also consider myself financially savvy.  I've worked in financial services for the last 20 years.
It seems crazy to me that they have not written directly to those who are receiving child benefit until now.  8 years later!  Does anyone else have any experience of this.  Can I appeal against it?

thanks in advance for any help.
J

calcotti

You cannot appeal. The charge was introduced by Osborne/Cameron. If you are liable you will have to pay. In each year 'adjusted net income' (https://www.gov.uk/guidance/adjusted-net-income#what-adjusted-net-income-is) between £50,000 and £60,000 will mean some of the CB is repayable, earnings over £60,000 will mean it is all repayable.
https://www.gov.uk/child-benefit-tax-charge
For the future your wife can continue to claim Child Benefit but she can ask not to be paid. This means that, until your children and both 12, she will still get Class 3 NI credits towards her future State Pension. Obviously if she is in work she may be getting Class 1 contributions in which case she doesn't need the Class3 in which case she could cancel the claim.

daveyjp

High earner?
Have children?
Receive CB?

Complete a tax return.

Dazed_and_C0nfused

It maybe needs renaming though. 

From 6 April 2021 the basic rate threshold (outside of Scotland) will be £50,270 so some basic rate taxpayers will be liable for HICBC.

sheramber

 https://www.gov.uk/government/publications/high-income-child-benefit-charge-data/high-income-child-benefit-charge#:~:text=The High Income Child Benefit Charge ( HICBC ) was introduced in,or whose partner gets it.

HMRC issued awareness letters to around 800,000 taxpayers in October 2012 advising them about the introduction of the HICBC and explaining how they might be affected. These were sent to people who an income of around £50,000 or more and where they, or their partner, were in receipt of Child Benefit.

In August 2013 HMRC wrote to around two million PAYE only higher rate taxpayers to remind them that they may need to declare any changes or additions to their income in the last tax year to HMRC. This included a prominent message on page one about the introduction of HICBC.

HMRC also ran an external marketing campaign on HICBC. It placed awareness adverts in national daily newspapers throughout November 2012. These adverts also signposted to the HMRC website for more details of HICBC.

Communications from July 2013 were targeted at those customers for whom the following statements applied:

• they had adjusted net income of over £50,000
• they or their partner were in receipt of Child Benefit payments
• they were not at that time in Self Assessment - and so needed to register

Between November 2013 and January 2015 HMRC issued 223,500 letters to remind customers what they needed to do to pay HICBC.

During 2018 to 2019 HMRC wrote to 79,726 customers to remind them what they needed to do to pay HICBC, and a further 73,668 customers in 2019 to 2020.

becky298

Hi all, whilst I know it’s a long shot and has been tried before maybe if this gets shared enough we might get some change. It won’t let me post a link but I have opened a new petition to get this reviewed ‘Change the way child benefit high income tax is calculated to total income’ please sign and share xx