Higher Income Child Benefit Charge

nancy_c_b

(posting on here instead of benefits forum as suggested) My husband is doing his tax return for 19/20. We were claiming child benefit back then, up until HMRC contacted us to say we owed the charge for previous years. We've paid all that back now apart from the year 19-20. In that year we received 8 payments totalling £1100.80.  My husband earned £56,528.84 that year. The self-assessment online is saying we need to pay a charge of £715. This doesn't seem right to me. If we'd claimed CB all year, payments would have totalled £1788.80. We were 'entitled' to 35% of that which equals £626.08. So surely we just need to pay back the difference between that and what we claimed which is £474.72. It looks like HMRC have calculated that we can 'keep' 35% of what we claimed (8 months) instead of 35% of what we could have claimed (12 months). Am I right and can we dispute it?

Dazed_and_C0nfused

Surely you have to pay back 65% of what was received.

£1100.80 x 65% = £715.

The problem appears to be you stopped claiming it when it was better (financially) to continue claiming.  And repaying 65% of the amount received.

Why did you stop claiming if his adjusted net income was going to be less than £60,000?

Jeremy535897

No. The percentage charge is applied to the amount received. On your basis, if you had received only one month's child benefit, you would be expecting a refund. See https://revenuebenefits.org.uk/child-benefit/guidance/how-do-child-benefit-and-guardians-allowance-work/high-income-child-benefit-charge/

nancy_c_b

Jeremy535897 said:

No. The percentage charge is applied to the amount received. On your basis, if you had received only one month's child benefit, you would be expecting a refund. See https://revenuebenefits.org.uk/child-benefit/guidance/how-do-child-benefit-and-guardians-allowance-work/high-income-child-benefit-charge/

Bleurgh. We stopped claiming because I knew we'd gone over the amount I thought we were entitled to for the whole year and didn't want to add more to our repayment bill which was already over 5k for previous years. I mistakenly thought they might apply some common sense to the calculation!

Jeremy535897

nancy_c_b said:

Jeremy535897 said:

No. The percentage charge is applied to the amount received. On your basis, if you had received only one month's child benefit, you would be expecting a refund. See https://revenuebenefits.org.uk/child-benefit/guidance/how-do-child-benefit-and-guardians-allowance-work/high-income-child-benefit-charge/

Bleurgh. We stopped claiming because I knew we'd gone over the amount I thought we were entitled to for the whole year and didn't want to add more to our repayment bill which was already over 5k for previous years. I mistakenly thought they might apply some common sense to the calculation!

For the reason I gave earlier, I think that the calculation does follow common sense. I can see your argument, but it wouldn't make sense if you stopped receiving child benefit after a month, because then you would be seeking an extra payment to maintain the logic. I can see why people give up entitlement when income reaches £60,000, as they will always end up with nothing, so it is just hassle, but if income is below that, you would always be better claiming the benefit and paying the charge.