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Original poster

Im so stressed - child benefit

20 replies

wonderingdaily · 20/04/2023 11:52

We have 3 DCs, husband very low earnings.

I had low earnings ( below £40k) until the year 21/22 where it jumped up to 72K due to bonuses.

Now this is the stupid/stressed part. I have absolutely NO idea about the child benefit cap of 50K, its never ever applied to me, ive just never ever known or thought about it until Feb this year i got a letter saying i may owe from 21/22 and to go online to register for a self assessment.

I immediately done this and also went on and looked and found a way to stop getting child benefit which i also done.

I didn't hear anything back and then got a fine for not filling out my self assessment, i tried to call and was on hold 2 x for 1 hour then got cut off but managed to live chat someone who talked me through the self assessment and it said i owe £2550 ish for 21/22. I feel absolutely sick.

I now have an online account and its telling me to fill out one for 22/23 and its now just occurred to me i must owe for that year up until Feb this year when i stopped it.

Ive tried to call but i get cut off after waiting one hour, live chat isn't available just now and im absolutely frantic.

Please dont flame me about not knowing, i swear i did not know, ive been employed with the same company for 10 years, ive never had to fill out a self assessment, never was above the threshold and i honestly never gave it any thought, i assumed everyone got this!! and then when i was told there was a threshold through this letter i assumed it was a household earning of £50k each so 100K.

I feel sick, dont know what to do or how to pay this back!!

OP posts:
violetskypurple · 20/04/2023 12:00

www.gov.uk/repay-child-benefit-overpayments

Information about repayments and a link to repay is here, if you need more time you have to ring them unfortunately, it's such a nightmare to get through but keep trying

turtlemurtle1982 · 20/04/2023 12:01

These thresholds have been in place for many years (maybe 6+). There was lots of talk about it and continues to be due to two people earning 49k in a household keeping CB but a single person earning 70k with a SAHP losing it. You will have to pay it back. Not been in this situation but I believe from others that you can agree a repayment plan or ask hmrc to adjust your tax code and take it that way. If your dh is low earning you might want to consider transferring the cb to his name as he will continue to get NI contributions. Then save up the cb and pay it back.

Original poster
wonderingdaily · 20/04/2023 12:42

Yes im on hold at the moment, im absolutely desperate to speak to someone to get this sorted.

I wondered if anyone has been through similar

OP posts:
mast0650 · 20/04/2023 12:50

No need to panic about the 2022/23 one. You've got untl the end of January 2024 to do your self assessment and then pay back the excess. If you fill in the self assessment on time it will be very clear how much and how to pay.

I can't help with the repayments for 2021/22

I never stopped our child benefit even though I/we have been over the threshold the whole time. Never got round to it and then the children got too old anyway. I just did a self-assessment each year. which I need to do anyway and paid it back then.

I have to admit I am surprised that somebody can be earning 72K and genenuinely have no idea that this disqualifies then from child benefit! (which isn't to say I don't believe you)

Caterina99 · 20/04/2023 13:10

You can pay the 21/22 amount due in installments. HMRC are usually pretty good about setting up payment plans etc

You have until 31 Jan 2024 to complete your 22/23 tax return and pay what you owe. I’d suggest not leaving it too late as the earlier you do it, the faster you’ll know how much you have to pay and also they can often take the money via your tax code.

I do think the child benefit system is ridiculous and unfair. But it is what it is and unfortunately ignorance of it is not considered a valid excuse.

Lastnamedidntstick · 20/04/2023 13:17

You’re on 72k after being on less than 40 and £2250 has you this stressed? Your monthly pay must have gone up by about that! Have you suddenly adopted a much different lifestyle? New house, private schools etc that is eating up the extra?

if you absolutely don’t have the lump sum you should be able to arrange an affordable repayment plan.

dementedpixie · 20/04/2023 13:19

The threshold begins at £50k and you would start to pay some back (10% for every 1k over £50K). At £60k it all gets paid back. Or you opt out of payment which I see you have now done.

See if you can set up a payment plan with them to pay back what you owe

Original poster
wonderingdaily · 20/04/2023 13:22

I managed to speak to him, the man was really lovely. and i think its all sorted now.

We can pay back the £2500 for 21/22 as we borrowed from parents.

The 22/23 he did advise we have until Jan 2024 so thats lifted a big weight off me.

@mast0650 I know, i feel absolutely foolish, with 3 young Dcs a mortgage bills food& high nursery bills like everyone else in this country, the money has been spent. For 10 years we always scraped by and when i got this wage rise and bonus i just, i just didnt think

@Lastnamedidntstick It wasnt a full wage rise it was a bonus mostly (25K) and then a £5k wage rise. We used the bonus money to book a holiday and redo the kitchen, and im just so annoyed with myself. We always saved the child benefit money and used it for their xmas. We are so lucky DHs parents have given us the first portion of money to pay and we will just figure it out by cutting back to pay the second part.

OP posts:
Testina · 20/04/2023 13:42

It would be good to use this as a reason to overhaul your approach to your finances.

I’m actually not surprised you didn’t know - people live in their bubbles.

But I am surprised that with a low warning spouse and 3 young kids your response to a £25K bonus was to spunk it all on a holiday and a kitchen. To the extent that you’ve had to borrow £2.5K from Bank of Mum & Dad. If you have no savings, that should have been your priority, not a kitchen.

Daisiesandprimroses · 20/04/2023 13:47

Testina · 20/04/2023 13:42

It would be good to use this as a reason to overhaul your approach to your finances.

I’m actually not surprised you didn’t know - people live in their bubbles.

But I am surprised that with a low warning spouse and 3 young kids your response to a £25K bonus was to spunk it all on a holiday and a kitchen. To the extent that you’ve had to borrow £2.5K from Bank of Mum & Dad. If you have no savings, that should have been your priority, not a kitchen.

Me too. You’re living hand to mouth I’m also stunned you just spent it with three kids and no safety net.

Lastnamedidntstick · 20/04/2023 13:47

wonderingdaily · 20/04/2023 13:22

I managed to speak to him, the man was really lovely. and i think its all sorted now.

We can pay back the £2500 for 21/22 as we borrowed from parents.

The 22/23 he did advise we have until Jan 2024 so thats lifted a big weight off me.

@mast0650 I know, i feel absolutely foolish, with 3 young Dcs a mortgage bills food& high nursery bills like everyone else in this country, the money has been spent. For 10 years we always scraped by and when i got this wage rise and bonus i just, i just didnt think

@Lastnamedidntstick It wasnt a full wage rise it was a bonus mostly (25K) and then a £5k wage rise. We used the bonus money to book a holiday and redo the kitchen, and im just so annoyed with myself. We always saved the child benefit money and used it for their xmas. We are so lucky DHs parents have given us the first portion of money to pay and we will just figure it out by cutting back to pay the second part.

So was the bonus a one off and you only got a 5k pay rise? Is so you’ll only have to repay that one year you got the bonus.

or is the 25k bonus yearly? if so even if you spent the first year’s you should still be in a good financial place to pay it back without having to borrow from family?

Original poster
wonderingdaily · 20/04/2023 13:59

We have zero debt.

We did have savings but we also used this towards the house renovations, i wouldnt say thats spunking it away, thats what we were saving for in the first place.

We absolutely arent living hand to mouth every month, we dont eat out loads or do big fancy things, we have one 3 year old car on lease. We have a standard semi detached house nothing fancy.

We used to save around £600 per month but then we needed nursery for the youngest which is around £600 per month. My 2 other children are on competitive sports which amount to approx £400 per month. Our mortgage rate was a fixed rate of 1.2 which jumped up massively and then all the other cost of living has increased and of course our heating bills were huge.

I was just so shocked and we were caught short, my lesson has been absolutely learned it was a true mistake which i rectified as soon as i possibly could and its now been sorted.

This years bonus will be determined in July ( if i get one) , and of course that will be saved.

OP posts:
Daisiesandprimroses · 20/04/2023 15:08

I mean this politely but you are living hand to mouth if you need to borrow to pay this.

living hand to mouth means spending everything on your immediate needs with nothing left for the future. Lots of folks live like that, not many get 25 k bonuses. I’d be thinking about how you both manage money if I was you.

KateyCuckoo · 20/04/2023 18:19

We have zero debt.

Well that's not true, you owe your parents £2500. Or are you not planning to pay them back?

violetskypurple · 20/04/2023 18:31

Didn't realise OP asked for budgeting advice!

Original poster
wonderingdaily · 21/04/2023 10:09

KateyCuckoo · 20/04/2023 18:19

We have zero debt.

Well that's not true, you owe your parents £2500. Or are you not planning to pay them back?

Yes absolutely, we have never asked for money before.

They have said they dont want it back but we will of course offer if and when i get a bonus.

OP posts:
Original poster
wonderingdaily · 21/04/2023 10:10

violetskypurple · 20/04/2023 18:31

Didn't realise OP asked for budgeting advice!

Thanks, i didn't realize i would be in for this scrutiny to be honest.

People get triggered easily

OP posts:
Mindymomo · 21/04/2023 12:04

You definitely aren’t the only person not to know about this, I work for an Accountant and I would say 80% of our clients had no idea of this change until we informed them and these are mostly people that do a Tax Return each year.

Original poster
wonderingdaily · 21/04/2023 12:19

Mindymomo · 21/04/2023 12:04

You definitely aren’t the only person not to know about this, I work for an Accountant and I would say 80% of our clients had no idea of this change until we informed them and these are mostly people that do a Tax Return each year.

Thank you, it was an absolute genuine mistake and once i was notified i immediately stopped it. I was just so stressed and felt sick but i feel better now its all sorted

OP posts:
BarbaraofSeville · 21/04/2023 15:25

OP, depending on what you mean by your DHs very low earnings, you might need to still keep the claim going to protect his NI record.

Plus if you don't always earn enough to have to pay all your CB back, you could keep receiving it and just complete a tax return each year.

Once you have a Government Gateway account, it's just a simple 10 minute job once a year and you'll be able to pay back any CB you weren't entitled to by adjusting your tax code, so you don't even need to pay it back in one go. I think you have to do the tax return by the end of October after the tax year ends to take this option though.

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