Huge overpayment child benefit

[sarahjnm]

Hadn't realised living with £60k earner meant that I shouldn't rcve child benefit for my daughter. Only just realised. It's been 10 years.
Anyone else been in this situation? I'm guessing I pay all back and penalties too. Could be as much as £15k.
I'm feeling suicidal at the thought. Our family are struggling as it is with various other things.

my DH asked for the penalty to be waived. It was either waived or reduced- I’ll need to ask him. He wrote to request this and was told in advance there was no point but it turned out that it was worth doing.

How much were the penalties? And did they give you a payment plan? X

But you don’t have a Child Benefit overpayment.
Your partner has a tax charge!
I know you are worrying about it. But why isn’t he?

>Totally disagree that most people on 60k would be filling in SA?! Why on earth would they?

OK, that was my exaggeration - but if the post pension etc income is 61k there's bugger all repayment anyway. OP is talking about full repayment so that's 80k plus and that sort of salary usually has p11d benefits meaning you would need to fill in SA.

In any case my point still stands - it's not OPs responsibility to know anything about partners income/tax situation and its certainly not her responsibility to pay it back.

Why?

We got caught out as well. I thought we were safe because DH was under the £50k threshold....but it's based on adjusted net income, so his gross salary PLUS his benefits from work. So when his company car and private health was added to the gross salary, it tipped us over. HMRC were very helpful when we called them. If you are proactive with HMRC they are more likely to help and be useful. They waived the late penalty for us and gave us a three month window to do the tax calcs and submit, as it was his first time doing SA. DH has changed his work car now to a hybrid, which means we now fall under the £60k threshold for this tax year. I'm tracking all his payslips, so if we get close to the threshold (he works overtime), we'll whack some money in his private pension to keep us under (that was advice from a qualified accountant). I hope it works out for you OP. Don't stress too much, I know that's easier said than done

If you phone HMRC yourself. Admit your mistake you may find they will ask for a few years repayment. They can’t go back more than ten years.
If you admit the mistake yourself there won’t be a fine, if they catch you out there will be.

A friend didn’t pay any tax on rent she’d been receiving for 15 years !!
She eventually admitted the fraud and they made her pay two years back with no fine. ( I know I was shocked too ) She wasn’t earning the £60k salary that you are OP so perhaps they thought they couldn’t get much more back.

Since you’ve now realised the mistake it’s always best to declare yourself. Whilst I am aware ignorance is no excuse, as the benefit is self declaring so they don’t have to spend money working out who gets it I think simply telling them you had no idea is fine. It’s not like it’s advertised on billboards.

Wow that’s huge fraud actually. I’d have gone to the police!!

@sarahjnm this is correct information…

I agree. A few PPs have pointed this out, but OP doesn't seem to take note.

@sarahjnm - you keep talking about paying the CB back, but this is your partner's responsibility.

Quite apart from the fiscal position, it would be morally wrong for you/your children to be penalizsed because he moved in with you. The CB is for you to use for the benefit of your children!

The partner needs to contact HMRC not her! She’s the lower earner!
It’s the higher earner who owes the money. They won’t talk to her about his tax situation. She can’t set up a payment plan she doesn’t owe anything!
Her DP needs to be proactive and not blame her!

We had this, didn't realise for almost 3 years. Husband's pay just crept over the threshold but having a car allowance as part of his salary made us misjudge. Held our hands up and immediately jumped through all the HMRC hoops when we noticed. Paid the bill as a lump sum, wiping out all our savings. Then came the additional 'late' penalties, which we are contesting as we paid what was requested of us the second the bill landed. The review of the penalties has been with HMRC since Feb, still no decision from them.

Interesting to hear from others that we could have requested a plan.

I’m another one who has just paid back the ‘overpayment’ I was going through a divorce in 2012 so I received CB as my earnings were pretty low, my ex was the higher tax earner so I assume he got the letter but we were separated so I didn’t receive any letters as he lived elsewhere. My new partner moved in several years ago, our finances are completely separate, I didn’t know what they earn and they have never had children so CB tax rules were not on their radar! My partner received a letter a few weeks ago from the HMRC and we were so confused! Once we realised that the CB was based on household income, we filled in the forms from the past years and I paid the whole amount as I received the CB and I am the parent, this has wiped out all my savings and I am hoping now that we don’t get any penalties, it was a genuine mistake and I have no more savings left!
The biggest frustration is that, I worked PT as I needed to look after the children and as my salary was less, it made sense. However, had we both had opted to work PT and earned £49,000 each, our household income would have been much more and we could have kept the CB!

@Aroundthebend - paying back the CB was not your responsibility! YOU are entitled to CB. Your partner should have paid - it is HIS responsibility as he earns more than £60,000.

once they know the total owed they will ask you to pay it back over 12 months.
However if you speak to the special debt team they can arrange repayment up to a few years (it used to be up to10 years)
Be honest and realistic in how much you can afford to repay monthly, don’t stretch yourself too thin!

What was this "massive campaign"? And all the news and comment about it? If at the time governments was using usual social media feeds, then those of us not on It would not have known. It passed me by also, I thought CB was universal, found out it wasn't by my SA (and fortunately for me sorted). Not one single letter to my home and still getting it into my bank because I've had no advice to stop / cancel. I like pp choose to receive and repay without any other guidance.

I owed about 2.5k. HMRC were actually really decent with me and allowed me to pay back over 18 months.

Why are you shouldering all the responsibility and blame?

If you applied for child benefit after the charge was introduced in 2013 it tells you about it in the letter you receive confirming child benefit. The big campaign was when it was introduced as people wouldn’t have had it in their original award letters

This isn't true for OP as the amount they're entitled to would have been £0 up until last year. There is a sliding scale, but the upper cap was £60k until the government changed the limit.

We got caught out by this too OP and had to repay a year or two- HMRC took it in monthly deductions from DH's salary (as he is the high earner, I earn less than half of this). It's a ridiculous system to do it based on joint income as two parents could earn £49k each and be entitled to the full benefit. HMRC won't take it all back at once and will agree a plan, as painful as it is I'd be inclined to contact them yourself as that way you can explain and avoid them later trying to label you as intentionally claiming them when you weren't entitled to it.

There must have been some sort of campaign as my kids were born 2003 and 2006 and i claimed for both of them. When the high income charge came in around 2013 I ended up opting out of the payment as dh earned over £60k. As I had a claim but opted out of payment it maintained the NI credits (only up to age 12/13 I think) and they got their NI numbers automatically at age 16.

It's such a shit system. I can't help but think how much money is actually saved by making it not universal and not means tested.
My husbands salary went above what was the £50k threshold a few years back and he got a letter telling him that he needed to do a SA but we were aware anyway. Seems they don't write to everyone though

I have just gone to cancel and the cb is in my ex husbands national insurance number. Not mine. But the money is going to my account.
We are speaking to a tax company today for advice

So his name is on the claim but he's directed it into your account? That means you won't be getting the NI credits if you arent working/on a low wage.

Can you do a counter claim so it's in your name?