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Did You
Know?
Practice No.
13444
Child Benefit - High Income Charge
Child Benefit
The new High Income child benefit charge came into affect in January 2013 and will impact many people. In some cases it can completely wipe out your child benefit leaving a nasty dent in your disposable income. TaxClever can help you minimise the damage.
You are affected if:
Your individual income is more than £50,000 and you receive child benefit.
or
Your income is more than £50,000 and you live, (or have lived during the tax year), with a partner who is entitled to receive Child Benefit.
If both you and your partner’s income are above £50,000 then the higher earner only will be affected.
Additionally, if you have an income of more than £50,000 and have a child living with you for which someone else is entitled to receive Child Benefit, (because they contribute money at or above a level equivalent to that of the Child Benefit for the child’s upkeep), you will be liable for the High Income Child Benefit charge.
It is important to remember to include all sources of income, not just your salary in determining whether you will be affected, e.g. Even if you are earning below £50,000 but receive benefits in kind, e.g. company car, medical benefit or have income from property, savings and other sources, your total income may well exceed the trigger point of £50,000. You also need to consider certain deductions and relief's such as pensions and any Gift aid to determine if you are affected, see Adjusted Net Income
If you would like us to help you assess your situation just contact TaxClever here.