High Income Child Benefit Charge

keepthelinguini · 9 August 2017 at 2:42PM

I'm so annoyed. I've just received a big bill from HMRC and been told I'm going to pay a penalty, and I think it's completely unjust.

I'm a PAYE employee.

In 2013 when the High Income Child Benefit Charge was introduced I earned under the £50,000 threshold - so the change in rules didn't apply to me.

Since then my income has gone slightly over £50,000.

I've just received a bill for well over £1k for missed HICBC in the two years ending 2015 and 2016. I called them to query, and they said I should have registered for self assessment when my income went over £50k, and that I'll be charged a penalty on top of the amount I owe - around £250 - for failing to notify them.

HOW was I supposed to know I need to start filling out a tax return when my income went above £50k?

I'm planning to appeal the penalty, but the lady in the call centre told me that it would fail because you can't claim ignorance of the rules.

IT'S SO UNJUST!

If anyone has any advice, I'd be very pleased to hear it.

TheCyclingProgrammer · 9 August 2017 at 3:35PM

You don't have any grounds for appeal I'm afraid so you're wasting your time. Ignorance is not an excuse.

The higher rate benefit charge was well publicised. It's your responsibility to notify HMRC when your income crosses the threshold and submit a self assessment.

Sorry if that's not what you wanted to hear. You may be able to arrange a payment plan with HMRC if you can't afford the repayments now.

Don't forget if you're still earning above the threshold you'll need to submit a tax return for the previous tax year by the end of Jan 2018.

[Deleted User] · 9 August 2017 at 3:40PM

I am not sure how anyone on here can help you as there was a huge publicity campaign about this when our dear Mr Osborne introduced this in January 2013. I hope your appeal is successful but, unless you come up with some other good reason, you are doomed to failure.

It doesn't help matters but it should be stated that the one organisation who was aware of your salary was HMRC as your employer is required to notify them electronically each time that you receive a salary payment. You can make your own judgment as to why it has taken two years to catch up with you in respect of 2014/15 tax year.

keepthelinguini · 9 August 2017 at 3:42PM

Thanks for this - I fear you're right.

But it two years after the change that my income changed. It's such an obscure thing to have to remember, particularly if you're PAYE.

What, for example, if I wasn't yet working in 2013 and this year I go above £50,000? Or what, for example, if I wasn't in the country in 2013? I think it's completely unreasonable for HMRC to expect people to know automatically that they have to start submitting tax returns without being notified.

keepthelinguini · 9 August 2017 at 3:45PM

[quote=[Deleted User];72963668]I am not sure how anyone on here can help you as there was a huge publicity campaign about this when our dear Mr Osborne introduced this in January 2013. I hope your appeal is successful but, unless you come up with some other good reason, you are doomed to failure.

It doesn't help matters but it should be stated that the one organisation who was aware of your salary was HMRC as your employer is required to notify them electronically each time that you receive a salary payment. You can make your own judgment as to why it has taken two years to catch up with you in respect of 2014/15 tax year.[/QUOTE]

People keep mentioning this huge publicity campaign. I really don't remember it. It was years ago!

00ec25 · 9 August 2017 at 6:24PM

keepthelinguini wrote: »

People keep mentioning this huge publicity campaign. I really don't remember it. It was years ago!

have you read the thread from someone else also caught like you and wailing about the rules of self assessment?

http://forums.moneysavingexpert.com/showthread.php?t=5691477

post#3 many help jog your memory?

xylophone wrote: »

This was extensively discussed at the time on television and in the papers - the point you make concerning dual earners was also made repeatedly.

http://www.telegraph.co.uk/finance/personalfinance/pensions/9367254/Child-benefit-cuts-to-hit-families-with-sole-breadwinners-hardest.html

http://www.telegraph.co.uk/finance/personalfinance/tax/10591211/Over-100000-parents-face-child-benefits-tax-fine.html

http://www.thisismoney.co.uk/money/news/article-2744983/Taxman-chivvies-30-000-parents-earning-50k-repay-child-benefit.html

http://www.dailymail.co.uk/news/article-2257728/Child-benefit-chaos-engulfs-Tory-MPs-Downing-St-orders-politicians-check-family-status-tax-inspectors.html

http://www.plusaccounting.co.uk/blog-post/high-income-child-benefit-charge-do-you-think-fair-tax

It is hard to know how anyone in receipt of CB could have missed it.

keepthelinguini · 9 August 2017 at 6:38PM

00ec25 wrote: »

have you read the thread from someone else also caught like you and wailing about the rules of self assessment?

post#3 many help jog your memory?

That was 4 years ago, and I wasn't earning enough money for it to be relevant to me at the time. Years later, I discover I'm supposed to have been filling out a tax return when my income went over the arbitrary £50k line, with no nudge from HMRC, and then I receive a penalty for it. This is not a way to run a tax system.

I also wonder at what point HMRC decides they need to start informing people. After all next year that 'publicity campaign' (a few articles in newspapers) will be 5 years old.

It's totally unfair.

keepthelinguini · 9 August 2017 at 6:54PM

00ec25 wrote: »

have you read the thread from someone else also caught like you and wailing about the rules of self assessment?

post#3 many help jog your memory?

Also ... I'd point out that only one of those links says anything about having to register for self assessment if you're on PAYE, and that's a specialist accountants website.

xylophone · 9 August 2017 at 9:02PM

All I can say is that (even though the legislation didn't affect me as I was not a CB claimant) I was concerned enough about the single/dual income aspect to write to my MP at the time...

http://webarchive.nationalarchives.gov.uk/20141007023213/http:/www.hmrc.gov.uk/budget2012/tiin-0620.pdf

Are you really claiming that you did not know about the higher earner CB charge?

Or that you were unaware that an increase in income should be advised to HMRC?

https://www.gov.uk/report-changes-child-benefit

kidmugsy · 9 August 2017 at 10:52PM

I suppose hmrc think that if you are capable of earning £50k p.a. you should be capable of behaving like an adult. Such sunny optimists.

StevenO · 11 August 2017 at 12:02PM

Same issue here, a four / five year old campaign or piece on the news that wasn't even relevant to me back then I can not be expected to recall.

I was chatting to my wife about another unrelated tax issue when we registered in their online portal recently, this led to us to look into a few other things and I discovered the 50k limit.

I've now registered for self assessment and waiting to hear back.

In my simple world when I am PAYE my employer notifies HMRC of my earnings each month and submits my end of year P60 on my behalf. My tax is adjusted by the payroll department in accordance with how much I need to pay, and I'd expect HRMC to question something if there is an issue (seeing as they already have all of my earnings and contributions on their system).

I have never been self employed or had to deal with tax returns as I have always been PAYE.

It's sheer luck that I found out that I owe the tax man money now. I could also have been subjected to a surprise letter and a penalty.

From what I read the system is a shambles anyway. One person could earn 58k, and be the only earner in his household and have to pay it all back or his partner not be entitled to family allowance. Yet compare this to the couple next door earning 50k each having nearly double the income and they are still entitled to claim the full amount.

High Income Child Benefit Charge

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