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AIBU?

Share your dilemmas and get honest opinions from other Mumsnetters.

Original poster

To ask if you had to pay tax penalty on Child Benefit

61 replies

Namechanger1776 · 10/09/2018 20:48

And if so how did HMRC take the payments from you. I think we have to pay for last year. My fault. We just moved in together and today we got a letter asking for info.

Help!

OP posts:
dementedpixie · 10/09/2018 20:57

Does one of you have an income over £50? Has the high earner done a self assessment tax return?

dementedpixie · 10/09/2018 20:58

£50K

Original poster
Namechanger1776 · 10/09/2018 21:04

Yes for 2016-2017 only. His basic was £50 but dropped below with pension then went above as he got a bonus.

He lost his job recently and is contracting so his salary has dropped right back down again. So at the moment we are ok it’s just this other year.

Problem that we have is his contract runs out end of September. What will HMRC do if we owe them money? I’m shitting myself.

And it’s my fault! Can we ask to have the money taken out of the CHB or pay back in instalments?

OP posts:
Original poster
Namechanger1776 · 10/09/2018 21:04

No he hasn’t done a self assessment

OP posts:
Lucyccfc · 10/09/2018 21:05

I used to earn between £50-£60k and had to fill in a self assessment. You get to choose if you pay in one go or have it taken out of your salary through tax over the next full tax year.

Be careful to choose the right one when you do your self assessment.

My whole package is now over £60k so I have cancelled my CB.

Original poster
Namechanger1776 · 10/09/2018 21:05

Ok that would be better that means his tax code changes is that right?

OP posts:
SocksRock · 10/09/2018 21:05

We have to pay back about 30%. It’s done via self assessment, the higher earner has to do it. If you complete it before 31st October AFTER the end of the tax you can ask for the amount to be collected through your tax code, if you leave it until the 31st Jan following, you have to pay it as a lump sum

Original poster
Namechanger1776 · 10/09/2018 21:07

I’ll have to get him to call them we can’t pay it as a lump sum and when this contract goes I’ll have to claim tax credits again.

OP posts:
dementedpixie · 10/09/2018 21:07

He needs to register for self assessment and do a tax return for that year. It will work out what is owed. It won't be that much probably as between £50 and 60K you only pay back a proportion of CB and it's only when you reach £60K that it all needs paying back

SocksRock · 10/09/2018 21:07

He needs to phone HMRC and ask to complete a self assessment for the 16-17 tax year. They will ask for it as a lump sum as you are very late (should have been done by 31st Jan 18), and there may be a £100 penalty for not filing on time. If you say you can’t pay, they may very well come to an arrangement with you to pay over one or two years through your tax code, but you will need to negotiate this.

SocksRock · 10/09/2018 21:08

How much over £50k is he and how many children do you have?

dementedpixie · 10/09/2018 21:09

He'd probably be best ringing them but i imagine he will still have to register for self assessment

Original poster
Namechanger1776 · 10/09/2018 21:10

Ok so for 2017-2018 he would need to do that in October this year ?

OP posts:
Original poster
Namechanger1776 · 10/09/2018 21:10

We have four children and he went over by £4800

OP posts:
SocksRock · 10/09/2018 21:11

I should add we have paid the £100 late fee once and always have to pay as a lump sum as my bloody husband won’t pull his finger out. We’ve had to use a credit card and pay that off over the year. I now try and put 30% of it away every month as it’s paid to me which helps, but inevitably I end up raiding the fund when the car breaks down or the boiler blows up...

Original poster
Namechanger1776 · 10/09/2018 21:11

That’s with his pension taken off. He got medical benefits so that was added and a bonus’s. 3 are my children, 1 of his.

Because I’m a low earner I’m so bloody naive with all of this.

OP posts:
dementedpixie · 10/09/2018 21:11

Was he living with you at the time of the higher wage?

NewYearNewMe18 · 10/09/2018 21:13

Yes, they wanted it all back over 24 months, so 85 quid a month

SocksRock · 10/09/2018 21:15

Yes if he files by 31st October this year for 17-18 you can opt to pay it via tax code, but you have until 31st Jan before the late fee kicks in.

If he is £4800 over, you will be asked to pay back 48% of the CB. Rates for 16-17 were £20.70 for the eldest and £13.70 for the younger 3 so you should be able to work out roughly how much you owe. DO NOT PANIC - they should be able to help if you can’t do it in one go.

SocksRock · 10/09/2018 21:16

You will need his P60 and P11D for the tax year to do a proper calculation.

coffeeforone · 10/09/2018 21:20

I claimed CB for a little while after DS was born. That was during year 2016-17. Asked them to stop it after a few months when I worked out we'd probably be liable for the tax charge.

I tried to register for SA to fill in a tax return for 16-17 several times and they said I should get a UTR by post within 21 days and I could do an online tax return. But they never sent me one any of the times I registered. I only claimed CB for a few months and because I was only on mat pay for part of the year I didn't earn the full £60k. So I think the amount I owe, if anything, will be minimal. I forgot about it until I read your post.

DC2 is due in a few weeks and I don't intend to claim this time.

Original poster
Namechanger1776 · 10/09/2018 21:21

Yes he was living with me. We can cope if it’s done monthly not in a lump sum.

OP posts:
Original poster
Namechanger1776 · 10/09/2018 21:22

The pisser that is losing his job might work in our favour if we don’t have an income to pay against for time being.

OP posts:
SocksRock · 10/09/2018 21:40

Best thing to do is for him to phone them in the morning and discuss. There are options. Once you know the damage, you can start to deal with it. Try not to panic as with 4 children and 48% to repay it will be around £1500 that you owe. Like you said, they can’t have what you haven’t got. There are loads of fab tips for budgeting, cutting costs and how to deal with debt and you definitely aren’t alone

SocksRock · 10/09/2018 21:42

If they give you 48 months to pay, that’s just over £30/month which sounds a lot more doable!