Child Benefit & Tax Return

Meatloaf1981 · 30 July 2017 at 12:40AM

I am not normally a higher earner, however this past year my income hit £50786.38. I received child benefit for one child of £1076.40 for the year in addition so I have needed to complete a self assessment tax return for 2016-17. I have no other income or deductions (Tax deducted was £8978.80) and my pension contributions are made pre-tax so are not included in my return. Having completed the only child benefit tax return calculator, I was expecting an "amount due" of about £75, however when doing the tax return it tells me that the amount owed is £610.40 which has left me very confused indeed. I can't imagine I have filled out the return wrongly, even though it is my first time as I have barely had to put any figures into it! Can anyone advise me about this? My income for 2017-18 will not exceed the £50k barrier and very little of it will be at 40% tax, in actual fact. Is the £610.40 a figure I have to pay to settle the "bill" or is it the amount they will deduct from my tax code next year?

bob_bank_spanker · 30 July 2017 at 6:36AM

On those figures it's clear £535 of tax was under collected by PAYE. Add on the £75 child benefit recovery and there's your £610.

Provided you submit online by December 30th the amounts owed will be collected by adjusting your current tax code.

Dazed_and_confused · 30 July 2017 at 7:44AM

Bob has given you a factual explanation of the numbers but if you want to understand why this has happened (and if it is in fact correct) you need to tell us exactly what figures you have entered, what your tax code was and how it was made up i.e. what entries were used to make up the final tax code

As a starter have you included your salary (potentially wrong) or your taxable pay, which should be shown on your P60?

Dazed_and_confused · 30 July 2017 at 7:47AM

I disagree with Bob regarding how you will pay off the debt though.

If you submit the return by no later than 30 December then the tax due should be collected in next year's tax code (April 2018 to April 2019).

If it were collected in your current tax code there would only be 3 months (Jan, Feb and March 2018) to pay it in if the return were submitted in December 2017

Meatloaf1981 · 30 July 2017 at 9:44PM

Ah right, I see what you mean. My tax code is 1233M as I have married tax allowance, uniform allowance and federation membership tax breaks included. My salary is actually 38001 but the remainder is made up from overtime payments taking it to 50786.38. I have checked I entered these correctly on the online form.

sheramber · 31 July 2017 at 8:00PM

If by married tax allowance you mean your wife has transferred part of her allowance to you being a higher rate taxpayer means you are no longer eligible for that.

Dazed_and_confused · 31 July 2017 at 8:42PM

My tax code is 1233M

If, as it seems, you are referring to your current tax code then this is largely irrelevant as far as your tax liability for 2016:17 is concerned.

Sheramber makes a good point about marraige allowance though, if that was in your tax code for 2016:17 and you are no longer entitled to it then that's likely to be £440 of the underpayment explained.

Have you included the uniform allowance and membership amounts on the return? If not that probably explains the rest of it.

Child Benefit & Tax Return

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