Freaking out about my tax bill - anyone got any idea why child benefit repayment would be so high?

[RiddleyW]

I'm just submitting my tax return which I have to do because we claim child benefit despite earning over the threshold. Usually I just repay the whole amount paid (about £1000 I think, we just have one child) .

For some reason the payment due is coming out as £4k - has anyone else had this? I can only assume I've underpaid tax somewhere (I'm just PAYE so don't know how) but can't work out when/ how.

Was hoping there might be someone on with some experience of this!

Claiming the child benefit is just not worth the hassle if you earn over the threshold. If you have to pay it back anyway There is no point in claiming it, because it always causes headaches at the end of the tax year.

Thanks for the explanations. I don't think it's ever something I'll need to worry about but good to understand!

I'll ask DH to start just claiming the NI element. When we started claiming I didn't earn as much so it made sense but now it probably doesn't.

Sorry to derail the thread but if you don't claim CB does your child not get a NI automatically?

On income of £117k, you'll also lose some of your tax free personal allowance which would be another 2 or 3 thousand, so that could be the difference.

I've never heard that it affects your child's NI (although this thread establishes me as pretty clueless). It does provide an NI stamp for SAHP (DH is one) so that's why we do it.

He can claim CB but opt out of payment which still gives the NI credit. A child benefit claim means your child gets their NI number automatically when they turn 16

www.gov.uk/child-benefit-tax-charge says:

If you’re affected by the tax charge

You can choose not to get Child Benefit payments, but you should still fill in the Child Benefit claim form. This will help you getNational Insurance creditswhich count towards yourState Pension.

Claiming Child Benefit also means your child will get theirNational Insurance numberautomatically shortly before they’re 16. They will not have to apply for one themselves.

I'm glad that I'm not the only one who is confused!

I've been claiming CB since DH and I were earing low to mid £30k. DH has had a new job for the past couple of years and I didn't realise that he'd gone over the threshold 2 years ago (separate bank accounts and we both pay into another for bills) - now in the past few days we've been hit with a £2.5k bills that's to be paid by 18th January!!

We spoke to hmrc and they didn't even sound sure of what they were saying.

The thing that's really made me angry about this is that I'm part time and earn half of what DH does. I use that money for DS every month.

Surely your dh should be paying towards your child too. How can you not know your DH's wages, do you not talk to each other?

He absolutely is, reading back that sounds terrible!

We've been entirely renovating an old property for the past couple of years and he's been paying for the bulk of that plus food. I use the cb specifically to buy ds clothes etc, as I've always done. It's not been anything shady on his part! He didn't know about the threshold because I'd always been the claimant. It was just lack of communication on our part.

You can just opt out of receiving the money and still get the NI contributions for your H, this is what we’ve always done- people don’t seem to know about this option for some reason.

It’s a complete pain if you hover around the threshold. I had carried on claiming and repaying because we’d considered having DC3 in which case (because I’m the higher earner) we’d be entitled whilst I was on maternity leave.

I fill in my form, get a large repayment and my NI code promptly changes so that I pay more tax for the rest of the year. I’m an accountant (not a tax one!) and am confused as everyone else.

@ShivD The person we spoke to HMRC told me we had to cancel it entirely, there was no mention of opting out of receiving the money.

i’m an accountant (not a tax one!) and am confused as everyone else

This makes me feel slightly better

Also from the link:

Already getting Child Benefit

You can either:

• stop getting Child Benefit- sometimes known as ‘opting out’

• carry on getting Child Benefit andpay any tax chargeat the end of each tax year

(We opted out of payment but I still got my NI credits up until ds was 12)

I stopped claiming child benefit when I earned over 50k as my uncle had a big fine for not paying tax on his. Didn't seem worth the risk.

I certainly don't feel better, I just can't see how i owe 4+ grand. HMRC wanted returns from me for 16/17 and 17/18, which I did and was told I owed nothing for 16/17, approx. £250 for 17/18. This was paid up months ago. I'm failing to understand how for 18/19 I would owe this. My last two returns I did paper ones and 18/19 was my first online one.

I’ve been doing it since the change came in, it’s definitely an option.

You have register but then opt out of getting the payment, you then still get a certain NI contribution (not the full one, can’t remember if that is class 2?) which counts towards your state pension if you are a SAHP or earning below the threshold to pay.

Thanks @ShivD - worrying that the HMRC person didn't know/see fit to mention it to us. I wonder how many other people don't know.

Paye does not always fully cover tax due over £100k so could well be £4k owed. If you are both earning you won't benefit from ni credits by claiming cb as you make contributions. It is most beneficial when one parent is not economically active. You can opt out of payments for next tax year but will face similar for 2019/20.

Does it say the payment includes payment on account for next year? It could be that.

We aren’t both earning LIZS