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High Income Child Benefit Charge - Page 3

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High Income Child Benefit Charge

edited 30 November -1 at 1:00AM in Benefits & Tax Credits
43 replies 5.3K views
135

Replies

  • Nearlydebtfree

    If you file your 2018:19 Self Assessment return by 30 December 2019 and owe less than £3,000 for that tax year and are still employed in a good paying job then you shouldn't need to pay the amount due for 2018:19 now.

    You can have whatever is owed for 2018:19 included in your 2020:21 tax code, effectively a 14 month long interest free loan.

    Thanks for this! Does this mean it would be taken from April 2021 from my salary if I didn't manage to pay it any sooner? Would this apply to the amount I owed for the years 2015, 2016 and 2017? They have agreed I don't have to pay a penalty so I just owe interest on the amount up to 31/10.

    Thanks again!
  • Dazed_and_confusedDazed_and_confused Forumite
    6.5K posts
    Uniform Washer
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    Does this mean it would be taken from April 2021 from my salary if I didn't manage to pay it any sooner?

    No. This only applies to money owed for 2018:19 and is dependent on you filing your Self Assessment return by 30 December 2019.

    If you do that and owe less than £3,000 and are still earning decent money you can have the money owed for 2018:19 tax code included in your 2020:21 tax code instead of paying it on 31 January 2020.

    Your tax code for 2020:21 will be reduced to collect what is owed and you will pay a bit more tax each month from 6 April 2020 through to 5 April 2021.

    If you don't do this at that time you cannot opt for it at a later date.
    Would this apply to the amount I owed for the years 2015, 2016 and 2017?

    No, you will have to pay that direct to HMRC.
    They have agreed I don't have to pay a penalty so I just owe interest on the amount up to 31/10.

    That is unusual, you usually have to pay interest until you actually pay the amount owed.
  • binkydoormatbinkydoormat Forumite
    10 posts
    10 Posts
    MoneySaving Newbie
    When I spoke to HMRC a few weeks ago the guy advised me to appeal any penalty and also to appeal any interest on previous years given HMRC have failed to tell me about the existence of the charge. I'm not sure how much I can rely on his advice though given I've now received a letter addressed to my mum instead of me (although with Mr rather than Mrs!).
  • calcotticalcotti Forumite
    6K posts
    Ninth Anniversary 1,000 Posts Name Dropper
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    You may find this recent House of Commons paper interesting https://researchbriefings.files.parliament.uk/documents/CBP-8631/CBP-8631.pdf
    It looks at the charge, the criticisms of it and the criticisms of how HMRC introduced it and have treated people affected since.
    Information I post is for England unless otherwise stated. Some rules may be different in other parts of UK.
  • I received that same letter last week so thought I'd better check everything out as I'd never heard of the HICBC before (I certainly don't remember getting any correspondence on it).


    Anyway I filled out the calculator and phoned them and I was told I owe £3400 including a penalty of £200+ for three years up to 2017/18.


    I will owe £1076 for 2018/19 once I fill in the self assessment and will probably owe another £650 for 2019/20 when it comes.


    I actually feel sick.
  • MrsemmapageMrsemmapage Forumite
    24 posts
    10 Posts First Anniversary
    I can believe this is happening to me and my husband. We have never heard of this charge and my husband from 2016 earnt over 50k by like £1k - now he earns a third of that and we need to find all this money - I literally feel like am going to have a nervous breakdown, I can understand this at all!!!
  • Dazed_and_confusedDazed_and_confused Forumite
    6.5K posts
    Uniform Washer
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    If his (adjusted net) income was only £51k for a tax year then he would only need to repay 10% of the Child Benefit received for that tax year.
  • edited 16 November 2019 at 5:58PM
    StephenP66StephenP66 Forumite
    1 posts
    edited 16 November 2019 at 5:58PM
    I have also received this letter. I have never heard of this tax before either.
    I thought this letter was a dodgy one as my first name has been spelt incorrectly. Steven instead of Stephen.
    How can they get this wrong? I have been on the hmrc website and my name is spelled correctly.
    I went over the £50000 because I sold some company shares to pay off some debt otherwise I would have been under the threshold. Can I take this amount off the calculation?
    This is my typical kind of luck. Last week I got a tax refund as I had apparently paid too much tax. The company I work for sort my tax (PAYE) so I don't know how this can happen. Then this week they want twice as much back.
  • Dazed_and_confusedDazed_and_confused Forumite
    6.5K posts
    Uniform Washer
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    I went over the £50000 because I sold some company shares to pay off some debt otherwise I would have been under the threshold. Can I take this amount off the calculation?

    If it's part of your adjusted net income (which determines the High Income Child Benefit Charge) then no, why would you think you could deduct it??

    Sale of shares is commonly a Capital Gain, not taxable income. Bit this may be different depending on the exact nature of what happened with the company.
    The company I work for sort my tax (PAYE) so I don't know how this can happen.

    Don't know why you think that, it's not true. Your employer is responsible for deducting tax based on the tax code provided to them by HMRC. It is your responsibility to check that the tax code HMRC have calculated is correct.
  • I would suggest it’s HMRC’s responsibility to determine the correct tax code, especially for those whose employers do their tax for them. The same for the High Income Child Benefit Charge, we cannot know about this unless HMRC inform you of it at some point. The average Joe cannot know all tax rules and information, it needs to be provided. 😡
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