High income child benefit charge letter

Hopingforthesimplelife

Hi all,

tried speaking to hmrc but received a couple of different responses so thought I’d check on here.

Couple of weeks ago I received a letter querying/suggesting (but not directing) I needed to pay back some of the child benefit. 

My taxable income last year was £55,500 with an extra c.£150 of employer benefits and a small amount (£200 ish) worth of non isa interest.

however after my pension contributions of £5525 (grossed up to £6,800) my adjusted net income was below the £50,000 threshold.

So 2 questions:

1) are my sums correct?
2) if so and my ANI is below £50,000 I do NOT need to fill in self assessment form

many thanks for any help 

[Deleted User]

1) Almost - £5525 grosses up to £6906
2) Have you received a notice to file a self-assessment tax return? If so, you must complete it. In any event you need to inform HMRC of your personal pension contributions. 

I am somewhat removed from this now but it does seem that you should complete a return, at least initially:

https://www.gov.uk/check-if-you-need-tax-return

Grumpy_chap

You would appear to be below the (just) threshold when considering your ANI.
HMRC appear to have generated the letter based only on your P60 data and not linked the pension contributions you made.

Dazed_and_C0nfused

Hopingforthesimplelife said:

Hi all,

tried speaking to hmrc but received a couple of different responses so thought I’d check on here.

Couple of weeks ago I received a letter querying/suggesting (but not directing) I needed to pay back some of the child benefit. 

My taxable income last year was £55,500 with an extra c.£150 of employer benefits and a small amount (£200 ish) worth of non isa interest.

however after my pension contributions of £5525 (grossed up to £6,800) my adjusted net income was below the £50,000 threshold.

So 2 questions:

1) are my sums correct?
2) if so and my ANI is below £50,000 I do NOT need to fill in self assessment form

many thanks for any help 

You may not strictly be liable to pay any HICBC but you seem to be

A.  Miscalculating the gross pension contribution

B.  At risk of missing out on some higher rate tax relief on your RAS pension contributions.

Why wouldn't you want to complete a Self Assessment return on this situation 🤔.

You have control over things then and get any higher rate relief due.

Or is there more to this than your original post??

Hopingforthesimplelife

Many thanks for the replies

Purdyoaten thanks yes I was a bit lazy with my maths/sums you are of course correct.

no the letter was quite vague and suggested I might need to.

grumpy chap yes that’s what I wondered too. One of the hmrc advisors suggested it was a mass mailer so presumably a few of these letters were sent out.

dazed and confused - a) on miscalculation was this my simple error in grossing up as Purdyoaten has corrected? Or a more fundamental misunderstanding on how it works?

b) I have already claimed back a small amount of higher rate pension tax relief a few months back. 

The answer about not completing SA would be I haven’t done one before and understand once I do one I will have to do one every year. Given the choice I’d prefer not to. 

happy to be corrected if I have misunderstood the process or if filling in SA is simple it may be I’m over thinking it?

Dazed_and_C0nfused

Hopingforthesimplelife said:

Many thanks for the replies

Purdyoaten thanks yes I was a bit lazy with my maths/sums you are of course correct.

no the letter was quite vague and suggested I might need to.

grumpy chap yes that’s what I wondered too. One of the hmrc advisors suggested it was a mass mailer so presumably a few of these letters were sent out.

dazed and confused - a) on miscalculation was this my simple error in grossing up as Purdyoaten has corrected? Or a more fundamental misunderstanding on how it works?

b) I have already claimed back a small amount of higher rate pension tax relief a few months back. 

The answer about not completing SA would be I haven’t done one before and understand once I do one I will have to do one every year. Given the choice I’d prefer not to. 

happy to be corrected if I have misunderstood the process or if filling in SA is simple it may be I’m over thinking it?

a).  Just a simple miscalculation as £5525 net isn't £6800 gross.

b).  For which tax year?  If for 2021:22 was that based on the total RAS payment of £5525 (net) or some other provisional figure?

Where have you got your understanding from that once you complete a Self Assessment return you have to complete one every year 🤔

Your first post probably has the majority of information you need for the return so you might find it takes 10-15 minutes to complete but that's hardly onerous 🙂