State Benefits

Child benefit and tax charge

Child benefit	2021/22	2022/23	2023/24	2024/25
Rate of child benefit (per week)
Eldest/only child	£21.15	£21.80	£24.00	£25.60
Other children	£14.00	£14.45	£15.90	£16.95
Guardian’s allowance	£18.00	£18.55	£20.40	£21.75

Since 7 January 2013 there is an income tax charge where “household” income is over £50,000.*
The charge is 1% of the child benefit for every £100 income over £50,000.
The maximum charge will be reached on income over £60,000 when it will be equal to the amount of child benefit received.
Child benefit will continue to be paid without tax deduction at the point of payment.
No tax charge will be made for annual income above £60,000 (child benefit should have been fully reduced at this point).
The person liable to pay the tax in the case of a single parent family is the parent.
Where two people are living together as a couple, whether or not they are married or civil partners, the tax charge is payable by the person with the greatest net adjusted income.
Where person “A” or their partner is claiming child benefit, but is not liable to the tax charge, and the child lives with someone else, “B”, and B or their partner has income exceeding £50,000, the tax charge is made on either B or their partner depending on who has the greatest income.
Persons liable to the charge who are subject to PAYE will have their tax code adjusted so that the child benefit tax is collected from their salary or wages.
Self-employed individuals, partners in a business and others who pay all their tax through self-assessment will pay the charge as part of their instalment payments due on 31 January and 31 July each year.
Spring Budget 2024. From 2024 the withdrawal threshold will be increased to £60,000, and the rate of charge will be lower, at 1% for every £200 of excess income. This means that full withdrawal won’t occur until adjusted net income is at £80,000.
Note. Net adjusted income is your total income, which is subject to income tax, less deductions that reduce the amount on which tax is payable; usually these will be tax allowable expenses, pension contributions, gift aid payments and losses from trade.

State Benefits

Child benefit and tax charge

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