Should we register for child benefit when over the income threshold?.. and other £ matters

[landscaper80]

I have looked into this before but was confused. I'm not an unintelligent person but I am not the best when it comes to understanding things like tax, pension etc etc. I was wondering if someone would have the patience to kindly break this down to me and explain it so I understand?

We are not eligible for child benefit as we earn over the threshold. My husband earns £95k and I earn around £20k. I am a company director for a small business which lost a lot of trade during Covid, and I was unable to fully build it back up, due to to having a newborn baby / toddler during that time. I also teach Art in a 6th form college part-time. So these two roles bring in about £20k.

Although our household income looks high on paper, we are in London where everything is £££ and until recently had nursery fees but thankfully all gone now. However whenever we factor in me teaching full-time it's not worth it due to the extra childcare we would need to buy for the mornings and afternoons/ evenings, versus the additional income I'd make combined with the lack of flexibility and added stress being a full-time teacher (been there), and of course not seeing our DC. (We have no family to help out so it's just us). The better option is for me to now concentrate on building the business up (now that DC at school) and make more from that whilst also having the flexibility to eg pick up child when needed and do morning drop offs etc.

Re child benefit, I never claimed it due to us being over the threshold but have just read something about it impacting my NI and pension? I make small NI contributions and normal pension contributions through my business (I get paid a small salary, not dividends as it is a social enterprise type set up), and I have a small teachers' pension but not much.

Is it in any way worth my while registering for child benefit even though it will be £0?

It all sounds a bit complicated and lots of admin and I don't need any headaches or more things to remember.

If anyone has any knowledge or advice given our situation I would be so grateful!

I did this too. It was recommended by the job centre when I had to make a claim for maternity allowance and there's no hassle with tax returns because I'm not actually receiving any payments.

If you claim child benefit you get credit for NI contributions for the years you claim the benefit up until the child is 12.
So if you are not paying full NI contributions it is worth claiming child benefit for the credits as that will affect how much state pension you will get.
Also if you are already paying NI so don't need the credits but a grandparent (under pension age) is looking after your child so not working or paying NI they can get the NI credit which will affect their state pension .

This actually did happen to us, DH got made redundant when DC2 was six months old. I went back to work, DH stayed at home with DC2 until he was 1 and then returned to work. We'd completely forgotten about it and then 18 month later when we did the tax return, it was a lovely surprise that we didn't owe anything!

60k per person in household.

If you husband puts into pension then it might be worth checking on HMRC site as it is tapered down.

Ie. If he puts 39k into his pension then he would get something....worth looking into OP