HICBC Commons Debate 18 March at 10:44AM in Cutting tax 5 replies 176 views

daveaspy

I've not seen this posted on here but may well have missed it - I just stumbled across a recent Parliamentary debate on the HICBC if anybody wants the govt. latest thoughts on the matter. I still don't think they really understand the problem  The minister is very clear she insists on paying her own tax and that it shouldn't be combined household, that everybody is taxed on their own earnings and not affected by their partners earnings - I wonder why I am liable for repaying the child benefit my wife claims then 

https://hansard.parliament.uk/commons/2023-02-02/debates/0D9BCE1C-7045-4F71-BDD5-E4597555A09D/HighIncomeChildBenefitCharge

purdyoaten2

You could read it another way though. The child benefit isn’t affected by combined earnings - it could be the case that both earn £49000 - combined earnings of £98000!

It will be affected if one partner exceeds £50100. 

sheramber

You could ask your wife to pay the charge  since she received  the benefit.


Independent taxation means that HMRC cannot divulge one partner's earnings to another.

Using combined earnings would not be possible without  that happening.

Some couples do not share that information.

How would you get round that.

the reverse situation to yours also applies.

If your wife was the higher earner and you claimed the child benefit she would be liable for the charge.

Jeremy535897

Benefits based on people living together do not sit well with separate assessment. The real problem though is that benefits can be affected when you just cohabit, as opposed to being married or in a civil partnership. Taxation never takes that into account, so even having an option to be taxed on household income as a married couple, made compulsory if you claim benefits, would not solve the issue.

daveaspy

sheramber said:

You could ask your wife to pay the charge  since she received  the benefit.

fat chance of that happening 

She doesn't earn over the HICBC threshold though. HMRC does know what I earn and that I'm in the same household though - they would certainly come after me (eventually) if I didn't pay any HICBC due and so they do know what the household is earning, it can't be a massive leap to take both incomes into account.

TBH I'm not even that bothered about taking both incomes into account, I just think the threshold should have risen way above what it currently is. As it is I've just managed to squeeze under the threshold again and given my pension a boost.

sheramber

I think the threshold to start paying tax should have been increased but the personal allowance has been frozen and continues to be frozen.