I think we have claimed child benefit when we are over the income threshold.

[clusterfuck101]

Before I start this please only comment if you have something helpful or constructive to say. I really don't need any nasty mean comments (which seem to be the norm on here of late) as I am in a right state and crying already. I am very scared about how we will pay this back if I am right but equally don't want to bury my head in the sand.

To explain I have 2 children from a previous relationship and a 3rd with my partner. He moved in about 18 months ago although we have been together a lot longer but living separately. I cancelled my tax credits when he moved in as our wages put us over the threshold and I asked him what his earnings were to check if we were still eligible for Child benefit.
I explained that if he earned over 50k we would not be able to claim it. He assured me his wages were no where near that.
Today he was supposed to get a pay rise/back pay and bonus in his pay packet. He also didn't get paid for over time last month so it was added to his pay packet this month. He got taxed 3k which was a huge shock and he sent me a picture of his payslip. On it I can clearly see his total gross pay is just shy of £62k!

I called him immediately as the first thing I thought was shit I have been claiming Child benefit and he is well over 50k. He started arguing that that's not his salary, its shift allowance and over time blah blah......I said they won't care- its his taxable income that they are interested in and clearly with shift allowance and overtime he has well exceeded the 50k limit.

The child benefit claim is in my name and from a quick google it looks like I am going to owe them 2.5k.......I don't have that kind of money. I work part time in an admin role that doesn't pay particularly well. My wages just cover the childcare bill and our food bills. Nothing much else. I don't even know where I will begin to pay back 2.5k if this is correct. (I obviously will pay it back but thats about 1/4 of my annual salary)

Does anyone know if I have worked this out correctly and if so what will happen. I am sat her sobbing because I don't know how I will repay this money- I guess I will have to get a loan but I will also be £200 a month worse off as I will no longer be able to get child benefit as we obviously shouldn't have been claiming it in the first place. My own salary is about to drop by £200 a month too so all together that's probably going to make me £600 a month worse off! I don't know what I am going to do and don't know where I should start in sorting this mess out.

@BarbaraofSeville we are about to get married so he will get half the house in the event of us splitting. Equally I will get half of his assets. We keep saying we should go to a solicitor to get something in writing in the interim but just haven't got around to it and as things keep getting more and more expensive the wedding is more and more on the back burner.

I will post on Legal and get some advice so me and DP are both covered in the event of us splitting although I hope it wouldn't come to that but its good for us both to have something in place.

Ah, missed that he moved into your house in your first post.

If you had significant equity before he moved in, you could look at protecting that. Also consider the financial impact of you working part time - eg your pension. Yours will be much smaller than his due to that, while you're doing the lions share of caring for his DC for free while he's at work.

Don't end up in the position where you're risking half your assets without some security back from him. Can extra be paid into a pension for you out of joint money?

You say you are 'only just covering your bills' what does he do with the rest of his earnings? On £60k+, he's likely got £3.5k+ pm coming in and you say he pays out £1800. Where does the rest of it go?

This is quite a common mistake. HMRC quill let you pay it back in installments.

It's a very unfair method of calculation and the threshold should be abolished. Child allowance should be universal and not means tested. Earning over £50k does not automatically make you well off.

I would say, that if his salary is £59k he should try and put the additional £9k into his pension.

At the moment, if that £9k he is paying 40% tax, so £3.6k is going straight to HMRC, and you are missing out on around £2.4k of CB. So £9k - £3.6k - £2.4k = £3k. He’s basically taking £3k of cash whereas he could put the full value of £9k into his pension.

I think if his gross is £62k and £59k after pension contributions, he’s only paying 5% into his pension which is low for quite a reasonable salary. So I’d definitely consider increasing them, if only to keep the money in your pockets (later) rather than HMRC !

It's very sensible to call HMRC and explain. They will ask lots of questions about finances, may ask you to complete some forms (can't quite remember what happened when I had to pay back). They did agree a payment plan for me as I didn't have the money to pay in one go.

Hope you get it sorted OP.

Call hmcr. You /he will be able to do a payment plan

It's a very unfair method of calculation and the threshold should be abolished. Child allowance should be universal and not means tested. Earning over £50k does not automatically make you well off.

As a loan parent earning above the threshold (due to bereavement), don't even get me started on that! Or the system of higher rate tax.

You should still claim cb and just request not to be paid it if he’s over the limit as this protects your NI contributions for your future state pension.

As an unmarried woman earning significantly less than her partner, this is absolutely not your problem.

You should continue to claim the CB and HE pays it back via his self assessment tax form. That protects your NI contributions, state pension and benefits the children. Plus means that if he leaves you you there is no break in income.