Confused over HICB charge

mjstephens2001

Hello, hoping someone can help explain the HICB charges for me.

We started claiming child benefit April 24 for one child. I need to repay tax through the HICB scheme. Tax for 24-25 should be reclaimed through a change to my tax code/personal allowance, and when I complete the self-assessment for 25-26 I will need to declare ~£850 of tax.

My tax code has been updated for 26-27 as shown. I assume the £1870 in the current tax year includes the deductions I am currently making via my tax code change (tax years 24-25 + 25-26). Hoping someone can help with the charges for next tax year, both the underpayment and child benefit seem far too high.

TIA

Woodstok2000

It's difficult to calculate without more figures, but that doesn't seem miles off.

Looking at your figures, could it be that your tax code for 25/26 is paying off your HIBC for 24/25, and the your tax code for 26/27 includes your arrears for 25/26 and the charge for 26/27 @as well, so come April 2027 youll be at zero with no arrears?

Back of an envelope, If your allowance is going down by £2100, you're paying an extra £421.80 in tax. That equates to about 31% of the annual child benefit at £26.05 per week, which would mean your salary is around £66,200.

Does that seem right?

Dazed_and_C0nfused

https://forums.moneysavingexpert.com/discussion/6660296/confused-over-hicb-charge

You have misunderstood some of that.

Your current tax code is not collecting anything related to 2024/25.

The deduction of 2,100 in next years code is almost certainly going to to collect the tax owed for 2024/25 (2100 x 40% = £840).

It would be unusual (but not impossible) for you to need to enter anything in relation to 2024/25 on your 2025/26 tax return.

By having the Child Benefit deduction in your 2025/26 tax code you should end up with a smaller Self Assessment bill for 2025/26 (other things could change that but you have at least been paying something towards there overall HICBC liability for 2025/26).