Child benefit question - do I continue to claim?

[BabbleBee]

I can’t find the answer, so would be grateful for help!

I’ve been a SAHM for 8 years, not entirely out of choice but one of my DCs has SEN and as the lower wage earner, DH and I decided that I would give up my career and he’d work.

During this time I’ve continued to claim child benefit. A couple of years ago he had a great promotion which put him into the high earner bracket, and as such the child benefit has to be paid back via his tax.

I’m now returning to work part time, back in my old career, and will be earning again and back in the system tax wise.

DH says I should now stop claiming child benefit, but I’m really reluctant to do so. I’ve continued claiming as I thought it was important to do so for pension tax credits, which DH tells me I now won’t need as I’m earning. I won’t be earning enough to pay tax.

Is he right? He says we’ll be better off if I stop claiming, but we haven’t fully discussed how he’s worked that out yet.

Any advice?

You can stop claiming but, having registered for it already, it will still count towards your NI contributions.

Assume your husband earns over the 60k threshold (after pension deductions)? If less then you would still get some but not all of it. And the remainder would have to be paid back in tax by your husband and he would need to do a tax return each year.

Will you be earning enough to pay National Insurance?

You are right that could benefit is important as it gives you a qualifying year of NI credits towards your state pension.

www.gov.uk/new-state-pension/your-national-insurance-record-and-your-state-pension

The worst that happens with a high earner and child benefit is that all of it is paid back - you can never be worse off than if you hadn't claimed it so that's bullshit.

Your pension is also just as important as money in your pocket (or his pocket) today.

I would continue to claim - easier to keep things up and running

I hope the new job works out well!

www.litrg.org.uk/tax-guides/employment/what-national-insurance-do-i-pay-employee#toc-what-happens-if-i-earn-less-than-the-weekly-monthly-threshold-

I find some of the LITRG guides easier to understand. Essentially you'd need to be earning £120 per week for an NI credit.

You can claim the NI benifits without receiving the cash.
You wont be better off not claiming.

You can keep the claim but opt out of payment and that would protect NI credits too.

You will get NI credits from working anyway I imagine

Thanks all. I knew you’d know! It’ll be interesting to see why he thinks we’d be better off...

How much will you be earning? The NI threshold is low - around £8,640 I believe. If you're earning over that you'll pay NI anyway. Check hmrc website.

@DianaT1969 basic salary is just over £12k but will be slightly more than that with unsocial hours.

Have spoken to DH, he spent ages on the phone to HMRC trying to get it all sorted. We’ve got a huge repayment to make I’ll be continuing to claim for the next year and then I’ll look at how to claim without receiving any money.

Thanks all.

I'm sure I opted out of payment online

www.gov.uk/child-benefit-tax-charge/stop-child-benefit

Another benefit of claiming child benefit but opting out of payment is that your child will be mailed a National Insurance number shortly before their 16th birthday. Otherwise you have to register them in separate process.

You can claim it but opt out of payments. That preserves your ni record. Presumably your dh has been declaring it on his tax return so effectively repaying most if not all.

The person in receipt of child benefit can be a relevant matter should you and DH split.

I would remain registered as the receiving parent, even if you give up the payments or pay it back in tax. Do you share money, or do you keep money separate? In which case, this is why he objects - because you receive money he needs to pay more tax on (he would be wrong to deny you this CB money if he's denying you 50% of family money).

The only person better off by you giving up the CB would be either an estranged husband or a financially abusive husband.

Whatever you end up doing, do not take your name off that CB claim.

Oh , posts crossed. He has not been declaring it, why?

@PicsInRed

Whatever you end up doing, do not take your name off that CB claim.

That’s how I felt but I couldn’t quite say why

@LIZS

Oh , posts crossed. He has not been declaring it, why?

He has declared it, there was supposed to have been a payment plan set up for the previous tax year but for whatever reason it didn’t happen at HMRC end. DH hadn’t noticed that it didn’t come out as planned and now we have two years to repay by January.

@PicsInRed

The person in receipt of child benefit can be a relevant matter should you and DH split.

I would remain registered as the receiving parent, even if you give up the payments or pay it back in tax. Do you share money, or do you keep money separate? In which case, this is why he objects - because you receive money he needs to pay more tax on (he would be wrong to deny you this CB money if he's denying you 50% of family money).

The only person better off by you giving up the CB would be either an estranged husband or a financially abusive husband.

We have a joint account, all money shared and I have free access to finances. He takes care (or should have...!) of all of the financial admin as I do pretty much everything else and I just don’t have the time or energy for it.