Child benefit changes - what do you think?

[KateMumsnet]

Next week, the Inland Revenue will write to 1.2m families about upcoming changes to child benefit eligibility. The changes mean that from next January, single-income families earning more than £50,000 per year will no longer be eligible for the full amount (currently worth £1,055 for the first child) - and those earning over £60K will no longer receive it at all.

The changes are controversial. Dual-income families who both earn just below the 50K cut-off - who have, in other words, a family-income of just under £100K per year - will continue to receive the full amount, leading to criticism that the changes penalise both stay-at-home mothers and single parents. Accountants are warning that new partners of divorced parents could also lose out. And the entire process is so complicated - with families forced to fill out complex self-assessment forms for the first time - that the Inland Revenue has reportedly postponed sending out the letters because they can't find a form of words that families will be able to understand.

What do you think? Will you be affected by the changes, and what will it mean for your family? Are stay-at-home mothers being unfairly targeted - or is staying at home a luxury which shouldn't be subsidised by the taxpayer? Should child benefit be universal - or should it be available only to families who are really struggling? Let us know what you think here on the thread, and don't forget to post your URLs if you blog on this subject - we'll be tweeting them over the next few days.

Vivienne the difference in tax alone between 2x 30k and 1 x 60k is roughly £350 a month(happy to be corrected).That is more than enough to cover extra travel expenses and not all couples with 2 workers have high child care bills anyway particularly those with dc of school age. Once they get to secondary they come home later and eventually don't even need child care at all.

Also those on 2x salaries have extra pension paid in by their employer which any savvy couple on one income should be also be taking out of their 60k thus reducing it even further than 2 x 30k.With the loss of CB the difference between 2 families on the same income will be immense.

It's crazy-and unfair.

sovery I know we all accuse the PM & Chancellor of being totally out of touch with ordinary families in the UK, but you would think that David Cameron would at least have some empathy with the parents of disabled children and may try to understand the implications of losing CB and not being able to make up the loss by either going back into work or doing extra hours due to the responsibilities of caring for your child. He clearly hasn't got any empathy at all.

The whole thing is a massive con. At first, I was cross because it seems so unfair (as discussed upthread, if one single earner household with an income of 60k gets nothing , why sould their neighbours, with three kids, two separate tax allowances and an income of 99k be getting 3k a year for their children? That makes no sense at all), but now I'm cross because it's another perfect example of one rule for the rich and another for the poor... I cancelled my cb yesterday because dh earns over 60k. Fair enough, till I realised that I haven't adequately protected my NI contributions by doing so. Now, reading this, I'd be mad not to be sending in a new claim and DH can hire an accountant to sort it all out next year. Knowing what I know about the uk's totally fucked up tax system (I'm self employed myself) we'll be able to save ourselves tens of thousands of pounds in tax AND SAVE OUR CB to boot. How is this fair? It's total bollocks.

I still want to know exactly how they are going to police this policy. As someone up thread mentioned, HMRC cannot give either party any info about the other so how will they asses who is or isn't claiming it fraudulently? It's probably easy enough to do if you share an address and a surname, but what if you don't have the same surname? You could say that the high earner in your house is a sibling or a lodger and their income doesn't count. How will they prove otherwise without expensive investigations etc.

I have just been on the BBC website re:Child benefits and the number of people who comment on there are so bitter towards people like me with a dh earning 50k - they seem to think we are rich -HA!

I work but part-time as a dinner lady in the school kitchens because I cannot afford to work full-time and pay a cm my whole wage espeically in holiday time, I am hoping that when he starts hig school I will be able to get a job full-time but am not holding my breath, there are precious few jobs around here and if you haven't got experience that is it.

CB is the ONLY government benefit we get, and why not, dh pays enough bl**dy tax!

Mum the reason people think that is because of the way the gov keep putting it across and consistently avoid answering the unfairness question.

What really bugs me is some of these people will be in families with 2 people earning and due to tax be getting the equivalent or even more than the very people others slate. I also think many know if it was made fair ie on household income they'd lose out.

It is a huuuuge mistake for the gov as the middle voters they need and their extended families won't forget this( I certainly never will)and others aware of the unfairness will be v cautious re voting Tory again as when you chuck fairness and logic out the window who knows what they'll do next- reduce it to 40 k,then 30k,do yet more for the highest earners and the grey vote at the cost of the good old squeezed middle??

There is a huge amount of ignorance of what people have and earn and jealousy. Someone who is a single parent on £50k a year solely supporting a child tends to pay £14,000 tax, £14m,000 childcare for one full time nursery place and £14,000 mortgage on £150k mortgage. That does not leave much over and is not too different from someone on £20k who gets housing benefits and tax credits, nor not too different from someone who doesn't work and has all their housing and support paid (and has no child care as they stay at home as a single parent).

The Government has been very successful in annoying middle England. They are keeping pensioners happy as they tend to vote. However unless they start winning women's votes they do not haev a lot of chance next time (mind you Labour left the country in such a state whoever won last time was getting a massive poisoned chalice and would not rule again for a generation perhaps because of the huge debts).

I can afford as a single mother lose all my child benefit and I will keep working 50 weeks a year and often 7 days a week and I am lucky I love my work.

I agree Xenia unfortunately for the Tories methinks an awful lot of people will be voting next election. The thought of DC in power until 2020 will get me out now come rain or shine.

The trouble is though polka - who do you vote for? Labour has damaged this country irreparably through uncontrolled immigration and swelling welfare bills. They will just create further havoc if they get in again. They also hate middle class aspiration and wealth creation even more than the current mob do and are likely to tax us even more than before. All that's left is UKIP and I don't think even a very pissed off electorate will want Nigel Farage as PM

I earn less than 10K and if they stopped my CB I'd be annoyed of course but If i was earning 60k I'd be surprised if it affected me at all. This being said I live in a really really cheap area of britain so Don't know how people manage on that amount in places like London...

Hmmm Ukip would get rid of tuition fees and those pointless wind farms we're all paying for in our hiked up energy bills(can't believe I actually looked up the Ukip manifesto).

To be honest I'm starting to think it's every family for itself and I'm beyond looking at the economy now.

The government are not going to gain much from this new tax, about 1bn. How about the government make the big corporations pay tax instead of 'letting them off' like Vodaphone (about 5bn). Or cut the budget for overseas aid (roughly 10bn) The NHS cost about 130bn but the NHS can't find ways to spend it all, it's just the tories are too terrified of cutting it's budget or upsetting their buddies in the city.

Savannahgirl, Labour was full of middle class oxbridge mps, so don't think they particularly hated the middle classes. I consider myself middle class and was about £600 a month better off when they were in power. The wealth was shared out and everyone was happier. The tories aren't cutting hard to pay off any deficit now, it's purely political. The deficit hasn't gone down hardly at all, wherever they got the figure of 25% from was pure fantasy. The deficit will not go down anyway if the country's economy is flatlining as there is not growth and not enough jobs are being created to balance the benefits bill. If the economy were prospering more, more people are in work and can pay for themselves.

Haven't read the entire thread, but be warned about canceling your cb, if like me you are a sahm and your dh earns over the threshold. If you leave the system you will not earn enough point on your NI to get a state pension, it's important that you check this out.

I'm not sure what the solution is but the current system is a mess and these changes are a total cockup.

I haven't had anything through at all. We don't earn the threshold though (although both work). Should I be chasing something or is it just people who are affected that hear from the government?

If neither of you earn over £50k then do nothing.

So you can be earning £45k and your DH £45k - joint income £90k and keep it all

Lottiegal what is your understanding of what one would need to do you in your situation to protect their state pension rights? Xenias post upthread suggested that as long as we are already in the system our rights would continue to be preserved.

I thought HMRC were contacting us about this? I've just clicked on this thread as in most active discussions to realize we probably should be doing something about this

polka I agree that there are definite problems with the change, but you're wrong IMO about 2 x £30k incomes going alot further than 1 x £60k. I don't know what the tax difference amounts to, but I don''t know anyone (and I mean absolutely anyone) where there are 2 parents working with no childcare costs. Admittedly I don't know anyone with teenagers, my children are at nursery + primary school, but everyone pays for some kind of childcare unless there is a SAHM. Definitely not many grandparents stepping in here. There might be an odd parent helping another one a day here or there, but not to the extent that they don't have childcare costs.

I work 3 days a week, admittedly my childcare costs will decrease when I have all 3 at school, but I've had childcare costs of over £1000 a month for over 6 years. I had twins at nursery to start with (£1200 per month just for 3 days) then 2 at after school and one at nursery (still £1100 per month). On top of that, I have fuel for my commute and parking. That £350 a month is an absolute drop in the ocean when you factor that in.

If dual income is used then childcare costs should be deducted. I also think it was my choice to have 3 children, so wouldn't be averse to there being a limit for say 2 children.

You also mention pension contributions, you assume that 2 earners will have 2 lots of employer contributions. Thats not correct either - companies have to offer a scheme, they don't have to contribute to it. My H has worked for 3 different companies and has never had anyone make contributions to his pension (other than himself!)

The unfairness if this policy makes me so, so angry - I look forward to voting against them based on this policy alone!

This CB change is a total cock-up. I had to stop work to look after my kid who is disabled. My partner, his Dad, earns just over the limit so he will get some or all of the value of the CB clawed back in tax, or I will have to give up the CB.

Now, I really don't mind paying tax if it is fair, I feel that is part of living in an organised society, but I do think that seeing two people in work who earn almost twice what my partner earns but keeping their CB, while we lose it, is a bit of a kick in the face for a family with a disabled member. I would far rather we just had to pay a bit more income tax tbh than lose this benefit.

This benefit comes to me as the stay-at-home person who looks after the kids and can't work! I also know someone who gets CB as her only independent source of income as her hubby only gives her a debit card on his account as he likes to know what she is spending (I'd never stand for it but there you go, and I bet she is not the only one).

We do earn enough as a family not to starve if we lose this money (will be harder to manage but it won't throw us into the gutter) but that is not the point, it's the way it potentially sets us against each other - do I lose the CB or does he have to waste a weekend and fill in one of those awful self assessment forms at the end of the year?

As long as one registers an underlying entitlement to CB you won't lose the NI advantages, so that isn't an issue. One hopes that is something that everyone is aware of so they go through the process correctly!

What is an issue is that CB would be lost if you had a living-in relationship with anyone earning over the limit, regardless of them having no parental responsibility for your children at all! If you share with a friend for any length of time, male or female, and they earn over £50K, it looks very much as if the CB people will want to find out if you are having sex with them or not, so they know if they should be chasing them for the extra tax.....

apismalifica, it is a complete night mare and it will get much worse, particularly when it comes to self-assessment time. Everything you say I totally agree with. They really haven't a clue and it just will not work out how they hope. My dh has not had a letter and he is between 50 and 60k. We have 3dc and I am a SAHM. I haven't opted out as I think the policy will fall on it's arse before this government is kicked out.

Crazy policy totally unreasonable to cut it for one person earning over 60k and allow 2 earning 49k each to keep it.

Could understand if they limited it to 2 children or one or none and got rid of it completely

If the reason behind it was to change the way middle earners see benefits then they have a lot of work to do with CTC/WTC before that happens

They have just been very obviously unfair and irritated a lot of Tory voters never mind the huge number of mainly women who will now have trouble with National insurance contributions for the state pension

I am outraged by the removal of my (much needed) child benefit. So much so that when it was announced i got rid of the (tax paying) nanny and implemented a childminder/au pair combination. Right back at ya, George!

I am sick and tired of being told by the government that my taxes must go up so i can fund perks for others which i wont be entitled to, and cannot otherwise afford to pay for myself.

We the working middle class have been squeezed too far.