Child Benefit / State Pension

Hi, we have been claiming child benefits for our two children.
i have changed jobs and will be earning over 60k with overtime.
My wife is a part time school teacher.

Im told I need to stop my child benefits as will have to pay them all back.

but I’ve heard that it’s still worth claiming and paying back every year due to State pension or something.

Im also led to believe that’s only applies if my wife wasn’t earning or was a low earner etc.

can anyone help please as I can’t seem to get a straight answer on this.
Do I stop claiming or not.

many thanks 
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Comments

  • BoGoF
    BoGoF Posts: 6,790
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    If your wife is above the lower earnings threshold for NIC purposes then she will be getting her NIC credits towards her state pension - how much does she earn. It's only non-earners that would benefit from continuing to claim child benefit as a means of building state pension credits.

    Is your £60K your 'adjusted' income - see calculator here - https://www.gov.uk/child-benefit-tax-calculator

    At the end of the day it's your decision, even if you need to pay it all back it's not due till 31 January after the end of the tax year so nothing stopping you claiming it and sticking it in a savings account gaining interest and pay it back when due.
  • bcfclee27
    bcfclee27 Posts: 228
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    BoGoF said:
    If your wife is above the lower earnings threshold for NIC purposes then she will be getting her NIC credits towards her state pension - how much does she earn. It's only non-earners that would benefit from continuing to claim child benefit as a means of building state pension credits.

    Is your £60K your 'adjusted' income - see calculator here - https://www.gov.uk/child-benefit-tax-calculator

    At the end of the day it's your decision, even if you need to pay it all back it's not due till 31 January after the end of the tax year so nothing stopping you claiming it and sticking it in a savings account gaining interest and pay it back when due.
    She takes home around £1500 per month.
  • bcfclee27
    bcfclee27 Posts: 228
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    Just seems a lot of hassle as opposed to just stopping getting the payments.
  • BoGoF
    BoGoF Posts: 6,790
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    bcfclee27 said:
    Just seems a lot of hassle as opposed to just stopping getting the payments.
    Totally up to you, your wife doesn't need the NIC credits as earning enough.

    And if you don't claim you won't have to complete Self Assessment Tax Returns - although you may need to for this year if your income is above £50,000 as you will have claimed Child Benefit this year.
  • bcfclee27
    bcfclee27 Posts: 228
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    BoGoF said:
    bcfclee27 said:
    Just seems a lot of hassle as opposed to just stopping getting the payments.
    Totally up to you, your wife doesn't need the NIC credits as earning enough.

    And if you don't claim you won't have to complete Self Assessment Tax Returns - although you may need to for this year if your income is above £50,000 as you will have claimed Child Benefit this year.
    So am I right in thinking it has no bearing on state pension. The only positive for still claiming is if I put the money into a savings account and benefit a bit from interest accrued. With the downside of this being having to fill out a self assessment etc.
  • BoGoF
    BoGoF Posts: 6,790
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    bcfclee27 said:
    BoGoF said:
    bcfclee27 said:
    Just seems a lot of hassle as opposed to just stopping getting the payments.
    Totally up to you, your wife doesn't need the NIC credits as earning enough.

    And if you don't claim you won't have to complete Self Assessment Tax Returns - although you may need to for this year if your income is above £50,000 as you will have claimed Child Benefit this year.
    So am I right in thinking it has no bearing on state pension. The only positive for still claiming is if I put the money into a savings account and benefit a bit from interest accrued. With the downside of this being having to fill out a self assessment etc.
    In this situation there will be no affect on state pension by stopping the claim.

    Just make sure you have a look at the calculator and be sure that your adjusted income isn't less than your salary. Things like pension contributions can be deducted from the gross figure to give your adjusted figure for the purposes of the child benefit threshold. And who knows there might be a surprise in the budget and the £50k threshold is increased.
  • molerat
    molerat Posts: 31,567
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    If a grandparent looks after the children and needs the NI credits transferred to them then the child benefit credits need to be claimed, either by claiming the benefit or a nil payment credits only claim.
  • bcfclee27
    bcfclee27 Posts: 228
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    BoGoF said:
    bcfclee27 said:
    BoGoF said:
    bcfclee27 said:
    Just seems a lot of hassle as opposed to just stopping getting the payments.
    Totally up to you, your wife doesn't need the NIC credits as earning enough.

    And if you don't claim you won't have to complete Self Assessment Tax Returns - although you may need to for this year if your income is above £50,000 as you will have claimed Child Benefit this year.
    So am I right in thinking it has no bearing on state pension. The only positive for still claiming is if I put the money into a savings account and benefit a bit from interest accrued. With the downside of this being having to fill out a self assessment etc.
    In this situation there will be no affect on state pension by stopping the claim.

    Just make sure you have a look at the calculator and be sure that your adjusted income isn't less than your salary. Things like pension contributions can be deducted from the gross figure to give your adjusted figure for the purposes of the child benefit threshold. And who knows there might be a surprise in the budget and the £50k threshold is increased.
    Thanks for all your help I really appreciate it. Im a police officer so pay about £500 a month into my pension.
    The whole calculator thing just blows my mind and I don’t really understand it all if the truth be told.
    It’s probably just easier for me to just not claim as I don’t have the energy to try and work this all out.
  • BoGoF
    BoGoF Posts: 6,790
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    There is no immediate rush so don't rush into a decision that will cost you money. Say your gross salary is £60,000 a year but you pay £6000 a year (£500 x 12) towards your pension that takes your adjusted income down to £54,000 meaning that you only have to pay back £829 of the £2074 child benefit you were paid. 
  • bcfclee27
    bcfclee27 Posts: 228
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    edited 10 January at 4:48PM
    BoGoF said:
    There is no immediate rush so don't rush into a decision that will cost you money. Say your gross salary is £60,000 a year but you pay £6000 a year (£500 x 12) towards your pension that takes your adjusted income down to £54,000 meaning that you only have to pay back £829 of the £2074 child benefit you were paid. 
    I’ve already put through last years where I earnt 57,000.
    it worked out I would need to pay back £1,600 of the child benefit I had claimed.
    I have paid back £1200 of this and have about £400 to pay by the end of the month.

    If this is correct re the pension payments. how do I ammend my bill. Would I need to ring HMRC etc ?
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