Child benefit - help me understand

[peepsypops]

Hi and apologies if this is really stupid to ask but I just can't get my head around child benefit.

Our situation - 1 DC 18 months. DH earns approx 80k pa and I earn 41k. I haven't claimed child benefit because from what I have researched I would have to pay it back in full at a later date.

However I have come across information where it seems there is still a tax benefit to claiming it even if you pay it back in full? Is that the case? I don't like to be in a situation where I owe money to anyone hence why I have never claimed it (it would have benefitted me during mat leave as I was MA only)

If it is relevant we do hope to have another DC which would mean a stint on SMP thanks to my generous employer 🙄😬

There’s no benefit if you are working, it’s the national insurance credit that is useful if you have 1 high earner and 1 non earner. As you both work that is irrelevant.

I don’t know of a tax benefit.

What I have done is to claim it but then tick the box that says I don’t want the money. That means I get the NI credits (in case you have any time out of work, or they can potentially be transferred to a grandparent if they care while you work), and my child is registered in the system for an NI number when old enough.

Yes I think your H earns more than the threshold so he will have to pay it back when he does a tax return form (October I think for the previous year). Not pointless to receive though as you still gain 'credit' towards National Insurance which goes towards your state pension. This is useful if you have a drop in salary at some point.

Think this only matters if you are not working as it gives you national insurance credits for your pension ,if your working don't think you need it .

Thanks all - that makes sense as now I recall the person who said this they are married to someone who doesn't work.

Would my NI be affected if I was to have another mat leave period? In which case maybe I should claim it (and maybe tick the box that says I don't want the money)

Does he pay into a pension though? If so, presumably his taxable income will drop below £80k and you may be entitled to something even if not the full amount. There is a calculator on gov website

I applied for it but ticked the box to not actually receive the payments. I will get the NI credits if I'm out of work again or go part time and my kid will get their NIno at 16 as they'll already be in the system.

Even if you had another Mat leave (or two, three) it's unlikely you'd need the credit because you need 35 years of contributions for a full state pension and you have 50 years to earn these (from age 16 to state retirement age of at least 67) so you have quite a few spare for university, maternity leave and even very part time work, which on your salary, you'd exceed anyway as you only need to earn around £10K? a year to get a credit in your own right.

Whether it's worth claiming CB currently would depend on how much your DH puts into his pension and whether he has any other taxable benefits such as a company car or private healthcare. It could be that you'll be able to keep around a third to half of your CB so worth the simple admin of paying some of it back - even a tax return just for this is quick and easy or I think he can do it via his PAYE code if he applies to do this with HMRC - have a look on their website.

Thank you all.

DH has a basic salary which is the topped up by how much or how little he works per month so it does fluctuate each pay month so we never quite know how to answer these questions.

I'll have a look at the gov page and see what the application says!

Just to note, SMP period counts for NI contributions so it’s only any mat leave in addition to that period where you may need to worry about making up contributions.

But even my part time jobs when I was a student have counted towards mine so at 46 I’ve almost hit my 35 years. It’s worth checking how many years you already have “banked”.

Doing the tax return for child benefit is a pain so I wouldn’t bother claiming unless with pension etc you can get your DH’s pay well under £80k for the tax year that started in April 24.

Another reason to claim is in the event one of you dies, the CB claim (even if not taking the money) leads into Higher Rate Bereavement Support Payment.