Child benefit

[greyinganddecaying]

I understand that if you earn over £50k you need to repay the child benefit you get, the amount dependent on a sliding scale up to £60k (at £60k you pay it all back).

How is this done? If you only have one job do you still need to complete a tax return or can you just send a copy of your P60 (& details of any pension payments that can be deducted)?

And if you do need to complete a tax return does HMRC prompt you to do this?

Any insight would be appreciated

Yes, you need to register for self assessment tax and complete a tax return. They don’t prompt you, in that they don’t email you and tell you that, as you earn over the threshold you need to do it, you’re just expected to do it.

It’s not hard and doesn’t take long.

You'll need to do a self assessment and before that you have to sign up for an account. Don't wait till it's due because the account involves a code coming in the post.

The closer you are to 60k the less point in claiming. You can also opt to just get the NI credit for your partner if need be.

I get it this year but won't bother next. My partner takes the credit as he's a student.

Setting up the HMRC account the first time- not each year. Just to clarify.

Even if on parent earns more than £60k and you have to pay it all back, it's worth claiming as a SAHP, as you get NI credits for your state pension entitlement.

Just to add, once it’s set up then they DO send you a reminder each year to do it, I meant they don’t prompt you for the first time.

That's great, thanks. I guess it's a case of contact HMRC & set up an account then - what's the deadline for submitting?

End of January after the end of the tax year. So, for tax year 2020-21 you need to register and pay by January 31st 2022

Ah thanks - that's gives plenty of time

Unless it has changed recently, we almost got caught out as for the first year, you need to have registered by early October. You can then file the tax return and pay anything due by the end of Jan. All of the info is on gov.uk.

They also take into account pension payments etc. So DH earns £65k but due to a large pension payment we still qualify albeit its adjusted through DHs tax code.

It's fairly easy to do though.

@SpnBaby1967

They also take into account pension payments etc. So DH earns £65k but due to a large pension payment we still qualify albeit its adjusted through DHs tax code.

It's fairly easy to do though.

Thanks - I had to phone HMRC today (I had problems with the website) and asked about this, they told me that pension contributions could be used to increase threshold for higher rate tax but not paying back child benefit.

This seems to be the opposite of what others have said. Does it make a difference if the pension contributions are taken before/after tax?

Look at you P60, there should be a figure for taxable pay - that’s the figure the use. Pension contributions will reduce your taxable pay.

@Margaritatime

Look at you P60, there should be a figure for taxable pay - that’s the figure the use. Pension contributions will reduce your taxable pay.

Thanks - so I use the amount on my p60, then do I need to provide proof of my pension contributions?

I think, because it's done through SA, it's not just what's on your p60. Private pension contributions and also gift aided charity donations will reduce the liability. So you could bump up pensions contributions, get 20% back (from income tax) and keep child benefit.

So I need to provide details of pension contributions to include with my self assessment to reduce tax paid & amount of child benefit I have to pay?

You will need to do SA which will take you through the data you need to provide.
The first year I created a spreadsheet of what I included which made it much easier in subsequent years as I gather all the info onto the spreadsheet and then input to SE.

Log on to the government gateway and start your SE, it will take time to gather all the data but it does explain what to input.