Earning 52k and child benefit?

[pippapips7]

We get the £87 a month child benefit for 1yo. When we applied, DP earned 40k and I earned 15k pro rata and it came in really helpful. DP got a promotion in January and now earns 52k (as did I and increased my hours but nowhere near this mark). At the time I made a mental note to check out what this means for the child benefit but it just popped into my mind yesterday. Will we no longer be entitled to it? I've had a look online but can't get a simple answer and a bit confused. Not sure if it's easier to just cancel rather than get a bill through to pay it back? Just hoping someone who has had a pay increase from under 50k to over 50k and received child benefit can shed some light on this?

His pension contributions should bring him back under 50?

I know his workplace pension isn't great, I can't remember exactly what it is so will double check when he gets home. Think it it might be only 3% which wouldn't take him under the 50k. But I didn't realise pension contributions counted. So for example, say he paid 4% pension that would would be 2080k a year and take him to just under 50k, would we be entitled to the full amount of child benefit then? Forgive my ignorance, I'm still getting my head round it all!

Agree with PP, if his pension contributions bring him under 50k you'll be sorted.

Otherwise you can check here what you have to pay back - you only pay all of it back when your earnings go over 60k.

www.gov.uk/child-benefit-tax-calculator

Yes, assuming no company car etc, and he puts 2000 into a pension you will get full child benefit.

Also, you don't loose it all until your taxable pay (ie after pension) hits 60k - so don't go canceling it yet.

Even if his work pension doesn’t bring him under- he can open a sipp and shove the 2k/year in there.

Pension contributions will likely bring him back under 50k. When this happened to us DH upped his contributions to keep us under the threshold as long as possible .

If he doesn't increase his pension contributions to take him back under the £50k threshold then he just needs to do a self assessment tax return thing every year and they then work out how much you need to pay back. It's a sliding % scale based on how much over the threshold he is.

We're in the same position as my husband has just gone over £50k with a recent promotion and it's definitely worth either doing the pension thing or just doing the self assessment each year (all info he'll need to complete that will be on his P60 each year), and keep claiming CB as long as you can.

There will be overtime available and also talks of bonus' but there is no definite at all on that, it really depends on the job (construction) so it's difficult to judge at the moment.

Good to know, I'll double check with him about pension contributions and advise him to see if he can up them.

I would continue to claim it and pay it back in the tax return anyway. Covers you for NI then and it’s in place if eg your DH loses his job. Also, you only lose some of it above £50k, not all of it,

he shouldn’t go above £50k in the tax year just finishing anyway, if he was promoted in jan.

We were in a similar situation and I carried on claiming and dh had to file a tax return. This resulted in him having to pay some of the cb back, about £700 ish iirc. Always better to do it this way, you never know when your circumstances might change and this way you have that bit of money coming in regularly. The tax return is fairly simple for someone who only works for one employer.

I'm.in the same position as have had a pay rise. I spoke to my financial adviser and did a lot of research - if you can increase pension contributions to bring you under the limit then great. But he might want to look into completing a self assessment tax return as I'm going to do because I've had a bonus too and it's based on earnings not just salary. I'd rather submit the details and know what/if I need to pay than be struck with a bill in future months/years.

My fear was that it will come to the end of the year and we'll face a large bill for him to pay it back!

Is it best do the self assessment tax return done at the end of the year? Or when circumstances change?

But he won’t have to pay it all if he stays on £52k - so you will still be better off.

You'd only pay back a proportion. It's roughly 10% for every £1k over £50k so if the income is £52k he'd pay back 20%. Once you reach £60k it would all be paid back

He needs to register for a self assessment tax return in order to pay anything back

Your self assessment for the previous tax year is due at the end of Jan.

So if he's had a payrise in this tax year and he's under 50k there's no need. His p60 will have the figures you need and then he'll know whether he needs to do one.

It looks to be like you'll be fine for this current tax year (but double check please!) and then if he does get bonuses or more payrises it may be worth upping his pension contributions to keep under the threshold.

I pay into some share schemes at work too that are deducted from my gross pay so keeps me under.

It is worth keeping it as you will only pay back some (if any). Just do a self assessment form for each year and it will be sorted

You could always pay all the cb into savings/ premium bonds from now on, then when the bill arrives, you will be confident that you have at least enough to cover it.
Like others have said it's a sliding scale and pension contributions are taken off before calculating take home pay, so chances are he won't have to pay much at all.
Obviously the tory government want you to just not bother claiming, so they can keep the whole lot.

That's not going to happen.

At most it's £1k you'll have to pay back, and that's only if he earns £60k after pension contributions.

If he starts to get a lot of extra overtime/bonuses, you could just save the CB money then it's there if you need to pay it back, if not, you have some savings to fall back on.

Just keep on top of tax returns as if you need to do them, and don't do them in time, you can get fined. So just start doing them and repay what you owe. It's a very simple job if the only thing you have to declare is some child benefit repayment, 10 minute job once a year, he can just do it when he gets his annual P60.

Put the CB into savings, then pay back what you need to?

Thanks all, really helpful responses. Great idea to keep it in a separate account just incase, will definitely do that going forward.

I put it in a different account with higher interest and then pay it back after DH does his tax return.

This is very smart

I'm in the same boat
Salary and car allowance and bonus will take me to £51,500 for 2023/2024
I do pay 5% into pension via salary sacrifice so that takes me back under £50k so assume that means I don't declare?