Owe HMRC ALOT of money- child benefit high income charvd

[Areyouactuallyseriousrightnow]

This may sound ludicrous. But we’ve just found out we should’ve been paying the child benefit higher income tax charge, since 2013.
We thought it started about 3 years ago, so I’ve been filling out my tax return and declaring my child benefit and my earnings (we were both earning between 50-60k) and thought the charge was being taken directly through my taxes.
Didn’t realise that my husband earns fractionally more than me with his benefits, and therefore he’s the one liable and has not been doing the tax returns etc.
I’ve calculated we owe thousands- at least £6k.
Any advice? We’re terrified, I’m not currently working whilst full timing caring for our children and I’ll have to somehow return to work immediately as we already are barely making ends meet.

You can arrange to pay back in instalments of an amount that is affordable to you. It will take a long time to pay it all of which isn't great but it won't make you destitute. Do ring them up and get it sorted as soon as possible though, the longer you leave it the more stressed you will be.

Get in touch today. Write a letter to make sure it gets there, but also try to ring.

You will have to pay back, but since you’ll have been the one to point out the error, you may well be able to avoid a penalty.

They're actually very accommodating to people owing the child benefit claw back, moreso towards those who are up front and compliant.

Tell them your circumstances, i.e. not currently working but looking for a new job, make full disclosure of your ins/outs and make a reasonable offer to repay the debt over a reasonable amount of time.

If you're up front, honest and reasonable, then they're likely to reciprocate. And whatever you do, when you agree a mutually agreed payment plan, stick to it.

That isn’t the experience we had!
We were due a similar amount to you, they kept adding interest to our debt.
We had a deadline to repay or we’d have another fine, we ended up using some savings and remortgaging to pay it all back.
Was a nightmare!
Really pisses me off too that my brother and sister in law on 48k and 49k each still receive child benefit.
We’re on 65k between us and we don’t get it.
Utterly shitty unfair system!

Utterly shitty unfair system!

^^Completely agree. It makes no sense. It should be based on total household income.

Are you certain you owe it - certain things like pensions come off your earnings. If you are say on £55,000 and put £5k in a pension you wouldn't pay it. Few other things come off. Check on HMRC website if unsure.

If you definitely do need to pay then your DH needs to contact HMRC asap and declare it. If he boosts his pension contribution that could mean you don't have to pay it going forward though does require you to have sufficient disposable income to do that.

Have you definitely checked you are liable? Has your husband deducted any pension contributions etc from his gross salary? In our case it brought our salary under the threshold.

Worth a mention in case it applies to you.

Otherwise, I'd just be honest and speak to them on the phone. You won't be the first one.

Feel your pain we are in the same boat
I need to call them again and work out how they can claim the money back.
We had absolutely no idea about this charge at all, I thought I would be fine as my pension would offset this. However workplace pensions done count only private ones
I've cancelled the child benefits payments and I've done a tax return but I've never done one before so I really have no idea if it's right
I think the trick here is there is one is to show as much willing as possible

As far as I know workplace pensions do count and can be taken off income - any amount you contribute up to an annual limit which is quite high, something like £40k pa. Check with HMRC though.

I've just had to do SA for first time and it is so complicated. Next time won't be so bad but first time and getting set-up took forever. They keep making errors on mine and I tell them and a different error appears.

Happened to us. We were below the threshold when we had DC1 and 2. Didn't make the leap when we had the third. We ended up owing about £5000 and they didn't give us a lot of time to pay it. Good luck.

My DH earns in excess of the threshold and has just had a letter asking about his earnings re CB. We may have been ignorant, but we've never deliberately deceived anyone. I have always been the one to receive CB and have never been asked about our household income. Seriously worried about how much we'll have to pay back and how long they will give us to pay. Any advice? Thanks.

Depends how much he earns- over 60000 after pensions etc them all of it, the amount is tapered between 50000 and 60000. They are really helpful he gives them a call- they will come to a reasonable payment schedule

Thanks @teabagleftin, I'll get DH to give them a ring and see what they say. I bet there are thousands of families in the same situation as many of my friends knew nothing about the threshold and have never been asked to declare their husbands/partners income.

Thanks for all the comments sorry only just seen it!!!
Sorry to those who are in a similar boat, depressing/scary isn’t it. But you’ve made me feel a bit better about us having made what feels like a colossal fuck up.
Those who’ve had to repay similar amounts do you mind saying roughly how long you were given to pay it or did you manage to agree a payment plan?
Those with the handy advice on pensions- does this apply to his contributions only presumably?
My husband phoned HMRC straight away and has been told to double check all his figures and calculate what he owes via the online checker and then tell them.

HMRC have a calculator

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

You take off his pension contributions and certain other things don't count, think childcare vouchers don't though check with HMRC. We increased pension contributions so didn't need to pay - you could do that for in future. This has some guidance in too:

www.theguardian.com/society/2018/sep/01/high-earner-tax-penalty-child-benefit-50000-salary-pension

I think my ds may be in ty he same position but is burying her head in the sand. I'm going to tell her to read this thread and give HMRC a call. How much is the fine, is it set or does it vary case by case?

I would double check your tax return too, as you might have already paid it. If this is the case you may have to amend your returns to reclaim and he can then pay it

Might be worth getting an accountant to check things for you

Be careful with pension deductions from wages. It depends on the scheme. Child Benefit claw backs works primarily from the figures declared on the P60 (taxable pay). Some/most pension contributions are deducted Before tax, so come off your gross pay, so have already been accounted for in your P60 taxable pay figure, so don't adjust again. It's only pension deductions taken from Net Pay (i.e. after tax) that havn't been already taken off the P60 figure and need to be adjusted for to reduce earnings for child benefit claw back.

Hi there I am unsure of what details go into the online calculator as my husband has a company pension and pays into a health scheme via his wages and also has an armed forces pension. Has anyone contested why they had never been advised before now, we only got a letter yesterday and my children were born prior to 2013 and my hubby only went over the threshold in last years tax year so didn’t even know about this tax until we received the letter yesterday and funny old thing today at work we received an email about the child benefit tax. Why couldn’t they have just put something on the tax assessment last year to advise you are now over £50000 check your child benefit entitlement or would that just be too much like common sense. Annoyed is an understatement.

Have they caught you or are you fessing up to them?

Also if you start doing SA dont forget that you are not only dealing with the SA in hand for the tax year just gone but at the same time,you need to plan for the year ahead to mitigate any taxes you have to pay.

I've gotta hand it to the HMRC, their timing is impeccable. A week before Christmas and they drop a letter through your door about this. I seriously thought I'd seen the last of this shower of shit when I gave up being self employed but no here they come, the bloody Grinch is here. God knows how much i'll have to pay back but judging from the tax calculator I looked at it's all of it. Just what we need. Happy Christmas HMRC, I hope you catch disentary (I'm not a complete animal!!) Happy Christmas everyone else :-)

I’d say that’s pretty good timing actually - better a week before Xmas than a week after, when you look at the opened expensive presents and think “I could have taken that back if I’d known”.

My experience of HMRC is that they are not the competent machine we might think they are. They are a machine that just spews out countless brown envelopes with incomprehensible letters,forms and bills. You fill them all in then you get sent more incomprehensible forms ,letters and bills. I find it easier to take charge of it all via SA and any queries i use the on line chat or ring them and tell them what i want and they are usually very obliging. I think we dont have to pay tax but we are just mugged into paying it voluntarily :)

Just got the letter too. Merry f*cking Christmas HMRC.