The High Income Child Benefit Charge came into effect on 7 January 2013. This charge affects taxpayers whose income exceeds £50,000 p.a. and they (or their partner) receive Child Benefit payments. If both incomes in a household exceed £50,000, the charge will only apply to the higher earner.

For taxpayers with an annual income between £50,000 and £60,000, the total amount of the charge will be a proportion of the Child Benefit received.  The charge is calculated as 1% of the amount of Child Benefit received for every £100 of the taxpayer’s income that exceeds £50,000.

For taxpayers with an income above £60,000 p.a., the amount of the High Income Child Benefit Charge will be equal to the amount of Child Benefit received.

Affected taxpayers need to decide whether it is worthwhile to continue receiving Child Benefit payments. If they decide to continue receiving Child Benefit payments, they will be required to register for Self Assessment and submit a Tax Return to HM Revenue and Customs for the tax year ending 5 April 2013 onwards, in order to pay this charge.

HM Revenue and Customs have contacted taxpayers who may be affected by the introduction of this charge. If you have received such correspondence from HM Revenue and Customs, or believe that you may be affected by the High Income Child Benefit Charge, please contact the office for further information.