Will you have to repay Child Benefit for 2018-19?
Topic: Repay Child Benefit for 2018-19
The High Income Child Benefit charge applies to taxpayers whose income exceeds £50,000 in a tax year and who are in receipt of Child Benefit. The charge claws back the financial benefit of receiving Child Benefit either by reducing or removing the benefit entirely.
If you or your partner have exceeded the £50,000 threshold for the first time during the last tax year (2018-19) then you must take action. Where both partners have an income that exceeds £50,000, the charge applies to the partner with the highest income.
Taxpayers who continue to receive Child Benefit (and earn over the relevant limits) must pay any tax owed for 2018-19 on or before 31 January 2020. If the partner who needs to pay the tax charge is not currently registered to submit tax returns they must do so by 5 October 2019.
The Child Benefit charge is charged at the rate of 1% of the full Child Benefit award for each £100 of income between £50,000 and £60,000. For taxpayers with income above £60,000, the amount of the charge will equal the amount of Child Benefit received.
If the High Income Child Benefit charge applies to you or your partner it is usually still worthwhile to claim Child Benefit for your child, as it can help to protect your State Pension and will make sure your child receives a National Insurance number. However, you still have the choice of whether to keep receiving Child Benefit and pay the tax charge or you can elect to stop receiving Child Benefit and not pay the charge.
For more information on repay Child Benefit for 2018-19, Book a Free Consultation