Another child benefit question

[SarahB88]

I’m a bit confused by child benefit as I’ve never claimed anything before and don’t want to get it wrong. I am the higher earner out of my partner and I, I am due to start maternity leave in a few weeks with our first baby.

I currently earn £62k before tax, pension etc. I know I can claim whilst I am on maternity leave however, will have to repay anything or will I be alright given my net salary is less than £60k a year? I don’t understand if it’s worked out on gross or net earnings. To add confusion in to the mix, I’ll be returning from mat leave during January 2025 but my flexible working request won’t begin until April 2025 as I have holiday to use so will be taking days off each week, therefore I’ll be on full time wages Jan-March. From April onwards my gross salary will be within the range so I know I’d get the full benefit amount and not owe anything back.

My question is, if I put my claim in when my child is born will I still get the full amount as my net earnings are below £60k or will I have to pay back some because my gross earnings are £62k? If I have to pay some back how does that work? I don’t want to get it wrong.

Or to avoid any hassle of paying back etc could my partner claim instead as he’s on £30k so well within the limit? Or does my salary impact him meaning we still pay some back?

Sorry for the long winded explanation, I’m just not sure how it works!

It goes on household income not an individual so makes no difference which one of you claims it. But even if your income is over £60k it is worth claiming as you'll only pay a small percentage back. You'll just need to do a tax return at the end of the year and it will tell you how much to pay back.

PP is wrong.
It goes on the individual income of the higher earner in a couple but it is income after tax within a tax year (so it’s different from gross or net).
if your pension brings your remaining gross income down to below the threshold, you will receive child benefit.
Some people deliberately pay more into their pensions so that they can qualify for child benefit.

If your income is between 50k-60k per year after pension deductions you'll pay 1% back per £100 over 50k.

Once you're over 60k you lose the benefit entirely. You repay by submitting a tax return at the end of each year.

Unfortunately your partner can't claim as it goes off the highest earning parents income.

The lower limit is now £60k from this April

Oh my God I've just read it online! @BananaLlama123

That's absolutely made my day 😭 we've been really struggling this is going to make a huge difference to us and hopefully many others 🥳

If the 62k doesn’t include pension contributions then paying 3K per year into your pension will bring you to 59k which makes you eligible for CB.

No it is based on the higher earner in the household. Check your p60. It is likely during your ml you will be eligible and for any part ml/working years. You can continue to register the claim and repay the overpayment, if any is due, via a tax return. It is only £0 when earning above £70k. Or opt out of receiving payments altogether if you ever have to repay it all.

Personally I'd say you're overthinking it, you don't know what's going to happen in the future. I'd claim it but keep an eye on your earnings and have plans in case you have to repay some or make extra pension contributions

@LIZS it's changed this month. The amount where you now get £0 is at £80k
So they upped the lower limit from £50k to £60k but then also upped the higher limit from £60k to £80k

@Jmaho my mistake. Not claimed for years and thought allowance had gone up 10k. Even more reason why op should continue to receive payments.

Thanks so much everyone! I’ll get the claim in once my baby is born then and just keep it in my name. I think after all deductions for the year I’ll be under £60k so should still qualify but obviously not an issue to repay whatever is owed. I’m just so pleased I qualify to be honest! It’ll be a good help during maternity leave especially.

So the amount of chb you pay back depends on the household income - see other experts for this!

The chb can be in either name of you and your partner. What you need to be thinking about is who will need to the NI conts until the child is 12. For example your partner earns £30k now but after your mat leave they are going to leave their job and look after the child. If the chb claim is on their name they will get the NI conts against their record until the child reaches 12. If the chb claim is in your name they will have to think of another way to get their NI conts.

I can see why you are confused. Several of the answers above are wrong.

It goes on the individual income of the highest earner in the couple.

It goes on gross (pre-tax) income but only the taxable portion so excluding your pension contributions and anything else that you get via salary-sacrifice, any charitable donations you are declaring on your tax return for gift aid, etc.

So as long as you are putting at least £2k per year into your pension, you are under the £60k threshold and will get the full amount.

Sorry to hyjack the thread op, but I've been unclear on this too despite claiming in the past (and doing a tax return last year for the HIBC).

Based on the new thresholds, if my salary before tax is £61K, and my take home pay is £43K ish after tax and pension deductions, am I eligible for the full amount of child benefit, or will I be liable for the HIBC?

If anyone is able to answer that I would be over the moon as I can't for the life of me get a straight answer from the government 😂

It doesn't depend on the household income though, that's the why its not always fair under the old amounts and using round figures one partner earns £60k, the other earns nothing - no child benefit but both partners earn £49999 full child benefit so the household income is £40k more plus the CB which will add up for multiple children

The govt have said they will look into it

If you do have to pay any back, it's nearly a year in arrears. You do a tax return in, eg, Jan 2025 for the tax year to April 2024.

Gross salary (before tax) not net (take home) is relevant.

If your gross (before tax) salary is £61k and you have no employee pension contributions then you will be liable to the charge related to just the £1k over

@sonshineandshowers

To add to my answer
This is assuming you are the highest earner in the household
You also mention pension contributions, you can deduct these from your £61k gross and if less than £60k then no higher income charge, ie no CB repayable

Thank you @TheOneWithUnagi!

So if I pay £200 a month into a pension, that would bring me under the limit?

It's weird because last year (when I earned less, just over £50, but the threshold was less) calculated 5) that id owe around £540 in HIBC but when I did the tax return it worked out at £8.36 😂

@TheOneWithUnagi thank you! That would explain it, I think. It's very confusing!

I am the higher earner, that but I am clear on, it's just hard to know how much to set aside ready to pay back - but your answers have really helped, thanks.

I think you need to ring and find out for sure what you are entitled too, we ended up with a 4k fine ☹️ don’t just take peoples word as gospel and hope for the best, HMRC will find out and will make you repay!

How did you get such a huge fine claiming child benefit?

No one can tell the OP what will happen in the future, the rules are relatively simple and you know what the maximum is that you'd have to pay back if unexpectedly you go over the new limits , it's not like it happens overnight

There are so many incorrect and misleading answers. You should claim and get child benefit unless the higher earner in the household is substantially over £80k net taxable pay i.e. usually excluding pension, gift aid etc but adding savings interest. If one of you is a SAHP they should claim so they get NI credits for state pension. Higher earner fills in tax return. The tax charge can be paid via an adjustment to your tax code if you do the return early enough so you don't need to pay as a lump sum. The government are aiming to change from individual to household income but haven't given any details. The section on high income child benefit charge on gov.uk is quite good.

I think it's the term 'net taxable pay' that is throwing me (and maybe OP) off. I'm not sure what to include in this figure. I am clearly very thick and shouldn't be earning anywhere near my salary 😆

Taxable pay is your salary plus bonuses etc and plus benefits like company car/ private medical
less any tax efficient salary sacrifice like pension and cycle to work.

Basically the number on your p60 or on the taxable pay YTD on your April payslip.