High Income single families losing Child benefit

[ReturnoftheMe]

Hi there - I know this has been talked about extensively over the years, but I wondered if anyone has been following the topic and discussions around it in parliament for the future? Are there any changes to come for the next budget?

I am a single mother with no input from my 2 kids father. I live in London work full time and currently cannot afford to put my 2 year old in nursery as fees are too high, and I am not eligible for any help (fees are 2k + a month in my area). Luckily my mother has stepped in, but without her I'd have to claim benefits and not work, or I'd have to dial down my ambitions and go for a part time job which puts me at a disadvantage in my work place.
This year I will gratefully receive a bonus that just about puts me at the point of not being eligible at all for any Child Benefit down to the penny. This really bothers me because all the families I know all receive it still. Some really high earning self employed couples who manage to complete tax returns that keep them eligible and even my own brother, both him and his wife earn 50k and 46k respectively and they still get CB for their two boys.

When is this going to change in order to be fair for single mothers like myself? I cannot afford nursery and I also do not get any child benefit. Something is incredibly wrong here.

Am I being unreasonable to feel as though this is unfair to single mothers?

How do you mean, @Icelandic9 ?

You earn £60k so you don’t need it. The threshold is far too high and the money would be better diverted towards those that do.

Do you pay into a work pension? Is it taken as salary sacrifice? Or from your gross or net pay?
If you call your pension provider you may be able to pay extra as a bank transfer from your bank account.
You pay it from your Net pay. The pension provider claims the 20% from the gov (I assume you are in England) and you will fill in a tax return and get the extra 20% back.

Or your payroll may be able to add you entire bonus into your pension from your gross salary.

Your Normal contributions may take your pay under 50k for the year.

I agree it sucks and I wrote to my mp/the gov to complain when it was first introduced as I felt the band would never be increased and eventually many ‘normal’ jobs would be paying back child benefit.

Not everyone has a choice. Id love to work more but I'm also a carer.

@Catterbat I earn £55K..the bonus put me over... it is more about how it makes it so unfair for single parents when couples earning far more than I do combined still qualify for Child Benefit. On this bases, the threshold should be increased. £55K is not a huge deal of money when supporting two children solely on one income, at least where I am from it is not. £60k isn't much different either once you consider the higher tax bracket.

I wouldn't expect something like this to be so purposely over looked in the UK.

OP, do you have any deductions from salary like health insurance, pension, life insurance etc already?

DO NOT stop your CB!!! You can't get it back, but what you can do is make sure that you have the extra cash put into a pension so that across the tax year you earn a taxable income of £50k on the dot so you keep 100% of your CB.

Far better that and have extra in your pension.

@Catterbat
£60k as a single income is equivalent to two people each earning £26k. On £60k you take home approx £3,750 before pension contributions and student loan. With £2k childcare expense you’re left with £1,750 less student loan etc. Liveable maybe but hardly a high income.

Meanwhile 2 parents each on £50k would be bringing home £6,300 ish between them and be entitled to child benefit.

It not always feasible to reduce taxable income by making higher pension contributions because it reduces the money you have available now and sometimes money now is more valuable than money when you retire.

I don’t think it would be that difficult to administer a system whereby they doubled the threshold for single parents. They operate a council tax reduction for single adult households already.

If you base that thought on council tax reductions, there's only a 25% discount for single households.

Just meed to figure out if I can force child maintenance on him while he lives in a European country.

@ReturnoftheMe Have a look at the REMO countries list for that

https://www.gov.uk/child-maintenance-if-one-parent-lives-abroad/other-partner-lives-abroad

Yes it's grossly unfair and the fact it hasn't changed in 13 years - had it risen with inflation the limit would be £65k

I read somewhere though that they had to do it this way so that each person maintains some privacy over income in a marriage/relationship - if it was done on a joint income then you'd have to tell each other what your salary is - this way the person earning over the threshold does the self assessment - without ever knowing what the other person earns

Yes it's a stupid system. We are a 1 income household earning just over the full repayment threshold. We still get it for NI benefits and just repay with my tax return but it eats me up every year when I know families who earn just below threshold due to part time work so they get to keep it but have higher family income. I did go part time for a while so we became eligible but I've now increased to full time as kids older.

@Ottersfortea do you think it is worth it with me earning £55K + if I get a bonus next year similar to this year? I am just hoping the policy makers will adjust what is classed as High Income. Surely £50k isn't the same value with inflation as it was 10 years ago?

As a side note, I spoke to a friend today who lives in Milan, her and her partner collectively out earn me by almost 100,000euro and they pay only 400euro fees PER YEAR for their son's nursery, so I think hearing that (although happy for them) has made look at my own situation and has left me feeling sorry for myself I guess. I feel like such a loser for not being ale to afford childcare, people are always asking me why my son isn't in nursery and I let them know I can't afford it. To which they look bemused because they expect all single parents get help, but most people have no idea.

I will have to speak to my MP to see if there is any forecast to having things change.

Why increase the threshold for single parents, if the issue is that it's unfair to penalise single parents? Why not reduce the overall threshold to the same level, so those in couples don't get a 'bonus', and make it a household threshold instead?

edit I do agree it should be raised in line with inflation, though.

I've lost all of mine this year. I've just hit £60k although £5k of that is health insurance benefit. And I daren't cancel that because I'm recovering from breast cancer, and anything could change in a moment.

So I actually have an income of £55k, have lost child benefit, am being taxed as if I earn £60k, have to pay 40% on the health insurance that I can't be sure whether I will use or not. And obviously the mortgage is up.

I have to repay R&C £1100 next month. Things are getting tight. 🙁 And before anyone says it, I know we are luckier than most. We have a house. I am grateful for that.

But it absolutely penalises single parents like us

Blame the Tory government.

The tax threshold needs to be higher than 50k, but the Torys are using it as a stealth tax.

Have you any idea what the average income is in the UK. It’s not £50k.

The effort does go to the super wealthy and large corporations. It’s very difficult for those to avoid tax, despite what the media would have you believe.

56% of the tax gap (c £20bn) is small businesses, so the likes of the self employed.

11% is large business, and 5% is wealthy individuals.

My pet peeve is (not the PP!) those who complain how the wealthy and large international business get to avoid/evade tax, when in reality the bigger problem is most likely to be those who are complaining.

Yanbu. It's massively unfair. The government won't do anything as it almost exclusively affects women.
All I can suggest is you to max out your pension contributions.

The limit needs to be raised too. IIRC it should be around 60k now. But, as before, it only really affects women so nothing will be done. (I earn peanuts so it will never affect me, I still think it's bang out of order).

I think the idea is if you're earning a certain amount you don't need benefits? We're not very high and have never had child tax credits, assumed it was for anyone, together or single, who earnt under a decent income and needed help to bring up to national average? X

I lost mine. I live in the south east, can’t even afford enough bedrooms for my son at Uni so I sleep on the sofa bed in the hols. I’m renting a 2 bed flat, on 63k, trust me I’m far from rich

OP the threshold is based on net income after pension contributions, so take these off your salary to work out if you’re over the threshold.

You have until September to fill out a tax return for the year to April 24 and can then take the option to repay what you owe back through PAYE in the 25/26 tax year so you won’t start repaying it til April 25 if this helps.

You are right it is unfair, worth complaining to your MP over how unfair it is to single parents in areas where £60k is not a high household income, but it won’t change now.

@safetyfreak I think you're right. It's Tory spite and their bigoted judgement of single mothers.

I am not a single mum through choice, I don't claim benefits or pop a baby out every two years. I have one well behaved and pleasant child, I work full time including all the way through chemo, I'm doing my level best, am a net contributor, have already paid 43 years NI and it feels like they take pleasure in sticking the boot in. 🙁

Do what my other half does pays more into the pension to keep it below so we still get child benefit. Your other choice is move to a cheaper area

A parallel universe named "London and the South East".