To be pissed off about paying back child benefit

[pinotnow]

I am in a sector that was awarded a pay rise this year - though our union is fighting for a higher one. The rise was from September but our school (yes, it's teaching) didn't pay it until November when we got months at once. HR always send us a pay statement at this time of year and I have just opened mine and seen I am now on approx £52k (been teaching 18 years and am head of a core subject in a large secondary school). I understand I now have to pay back some of my child benefit. This is a pisser as things are pretty tight and I'm a lone parent who gets no CM (ex is a total waste of space - I've gone through CMS). Also, I wasn't expecting it this year (I was on £49k last year and now I'm worried I've missed some sort of deadline for paying it back as technically I've been on this for 5-6 months, but only just realised.

I really haven't got the head space for this now and a quick Google has just brought confusion. As soon as you move forwards a bit in this shithole country you move backwards it seems. Any advice would be great!

@madamovaries if you pension is under a salary sacrifice scheme, you will have consented to that, so you should have received the relevant documentation and explanations.

To simplify numbers - you gross pay before pension and salary sacrifice, is £60k, and the pension deduction is 10%.
Instead of your gross salary being shown as £5k per month, with a £500 pension deduction, your payslip shows gross earnings of £4.5k, so the amount to be considered for CB threshold purposes is £4.5k x 12, not £60k.

This is the new hidden tax trap, wages have gone up but not the tax levels.

I know this is missing the point of the thread and I am sorry but to me, it sounds like you must be super-busy and super-stressed right now OP. You're a teacher, so you're obviously well-educated and likely you have to be better organized than the rest of us. So I think you must be overwhelmed at the moment to have to post on mumsnet that you can't work this out by putting your salary into the online calculator and understanding you don't include the portion of your salary that you pay to pension. I am also completely shit at understanding money (it panics me how much I don't understand) and if I can understand these things and you can't, I wonder if you're overwhelmed and tired and I just wanted to give you flowers and hope you can get a break and a cup of tea.

I agree with everyone else the stupid 49k per person is outrageously discriminatory against single parents and also stupid

[as you were, off-topic post that expresses sympathy to OP concluded]

You can log o to the hmrc system if you have your p60/payslip to hand and it will tell you what is classed as income each month the payroll has been run/reported.

I'm exactly the same. UPS3 plus tlr, extra duties and i did some examining. But pension keeps me well under the threshold for higher rate and CBenefit deductions.

Yes ... and why is that relevant? She is the beneficiary of transfer payments funded by people on (less than) a quarter of what she earns. Maybe she should spend more time working on stopping her school being a 'shithole' school and less time whining about how she deserves more of lower-paid people's money.

How much do you think you’ll have to pay back? We’re currently paying back child tax credits and have a payment plan

I'm really grateful for all the detailed replies setting out what my next steps need to be .

I've gone on the government calculator and put in my new gross pay as if it were my pay for the whole year and it says I would owe about £450 now. So ok less than a third (ish) of my total and but not something I can afford to just pay out so means I'd be better off just not having it. And the site says pension paid before tax can't be deducted so my teachers' pension contributions won't count. Bit sickening to say the least.

To everyone who thinks I'm a loaded whiner or something, I may be the latter but justifiably I think and I'm definitely not the former. To think I've worked my arse off to get a promotion and finally got a piddly pay rise after years of a freeze and I'm going to be losing out is absolutely gut-wrenching. Hopefully my standard of living might just about stay where it is rather than falling despite what looks like on paper a decent rise. Fucking great.

YANBU and disgusted that two thirds of voters here think you are.

A couple with an income of £90k would get full CB but you don’t. The poorly handled changes to CB are an utter example of political cowardice.

Someone else may have said it already as not read all the reply. The £50k is based on your gross pay less pension payments. The tax is not paid till the following year ! So income earned 6th April 22 to 5th April 23 is paid by 31st Jan 24 unless a sole trader with a different year end.

I'm so confused now! I'm in a similar position to you OP and always thought pension contributions could be taken off to bring me below the CB threshold - can't they ??

I've not read all the previous comments so apologies if this has been covered already.

This tax year ends in April, you have until January 24 to submit your tax return.
I do ours in April as its done then.

Some people will suggest paying more into your pension or other salary sacrifice schemes, in theory it's a good idea but bearing in mind you're in the 40% bracket you'll only be giving back 40% of it.
So if you bumped up your pension payments you'd be paying 2k a year out to save about £500.... the maths don't work.

There's a calculator on the government website that you can put your earnings into and how many kids you have and it tells you what to pay back.

We have 2 kids, I earn 54k a year and I think I have to pay back about £600 a year I think, we get 140 in child benifit so I get the child benefit put into a separate account then just take £100 into my current account and let the rest build up to pay off the bill at the end of the year.

Sorry just seen your post ! Surely getting 2/3 is better than getting nothing. Fingers crossed they will move the higher rate up as £50k is not that much these days. Especially when someone working can get UC of £400 a month if single 1 child and renting on a £39000 salary.

Agree completely- also families where one parent stays at home in the early years are totally punished by this. I stayed at home for the first few years as nursery wouldn’t have been worth it on my salary (also wanted to be with my kids as no family nearby to help). Went back to work as soon as both at pre-school/school.

Frustrating that if 2 parents are earning 49k and the grandparents are doing the childcare after school and in the school holidays (so no childcare costs), they still get child benefit. I really think they should change this rule for at least the first few years of a child’s life.

Depends on pension my husbands count.

Forgot to add, it's based off your p60 so your pension payments may have already been deducted in the net pay so be carefull if using the calculator as you can add pension payments in separately and wrongly count them twice.

You do deduct pension contributions from your salary, see these screenshots from
govt calculator:

And this one from moneysavingexpert.com: see the bit about what you deduct:

My husband earns over too and we don't get it either.

We told hmrc when my husband took this job and they said it was fine, thanks for updating us and sent us a bill for repayment of child benefit to them and wanted it in lump sum.

SuperSue77 - so can I use pension contributions to bring salary below 50k so as to keep CB ?! Teacher pension if that makes a difference

Agree it's bizarre that it's not based on household income. That's just crap.

It's a bit strange though that you say things are 'tight' on £52k a year. Surely there must be something you can cut back on so things aren't tight on a high salary?

This! Your pension contributions will probably bring you in below the threshold. If it doesn't - you might want to look into topping up your pension instead of paying extra tax!

That does seem unfair. Maybe it's designed like that on purpose so people don't try and 'cheat the system'? My neighbour used to have the father of her 5 kids living there but 'on paper' he wasn't in the picture

Yes you can. The govt calculator is confusing as on the salary page it says “less pension contributions on net pay arrangements” but then on the next page it says “pension contributions deducted from your pay (do not include contributions deducted before tax)” - this is what the OP read that made them think they couldn’t deduct their pension contributions - it’s telling you not to deduct your net pay pension contributions twice as they were already deducted on the page before, iyswim.

Please stop telling the OP she’ll have to pay it - she can deduct her pension contribution so she will be below the threshold for repayment which is actually £50,099 not a round £50k.