Contributed by MJB Avanti
10/06/2019 - MJB Avanti
So, most of us know that The Higher Income Child Benefit Charge (HICBC) was introduced in January 2013. Individuals with income over £50,000 per annum are liable to pay an income tax charge on Child Benefit payments they or their partner receive.
So that’s the nuts and bolts out of the way! Or is it? Avanti explains….
Let’s take a family of 4, two parents, two children under 6. Dad works 40 hours a week earning £55,000 per annum. Mum stays at home looking after the kids and hasn’t been in employment since maternity leave with child one. As mum was pregnant around the time of the changes, as a couple they decided they didn’t want the stress of tax returns each year and liability’s, so have never claimed child benefit.
What are the knock-on effects of this decision?
But if you’re not convinced that you may need to revisit this situation for yourself as you do not believe the benefit outweighs the hassle!
Then at least consider this, you can claim Child benefit with any income amount, but can opt not to receive payments.
What this means is;
If you need any help calculating the tax liability on child benefit or you need a tax return completing please contact Avanti.
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