The High-Income Benefit Charge Explained

If you or your partner receive Child Benefit and one of you earns more than £60,000 a year, there’s a tax rule you need to know about — the High-Income Child Benefit Charge (HICBC).

It’s one of those HMRC traps that catches thousands of families every year, often because the rules change quietly in the background. So let’s walk through exactly what’s new, how it works, and what you can do to stay ahead.

💡 What Is the High-Income Child Benefit Charge?

The HICBC is a tax charge that reduces or removes your Child Benefit when the higher earner in a household has an adjusted net income above a certain threshold.

From 6 April 2024, the thresholds were raised:

• The charge starts when your income exceeds £60,000.

• The charge fully removes your Child Benefit at £80,000 or higher.

It’s a tapered charge — meaning for every £200 of income above £60,000, you repay 1% of your Child Benefit entitlement.

By the time your income reaches £80,000, you’ll repay the full amount.

⚠️ Common Scenarios That Trigger the Charge

You might be affected if:

1. You or your partner get a pay rise or bonus that takes your income over £60,000.

2. You’re a company director who draws a dividend that increases your total income.

3. You’ve recently moved in with a partner who claims Child Benefit and your income is above the threshold.

4. You’re unaware of the rule and still claim the benefit without declaring it on your tax return.

Because it’s based on the higher earner’s income, not joint income, it can catch families by surprise — especially where only one partner earns above £60,000.

💷 What You Can Do About It

You have three main options depending on your circumstances:

• Keep receiving Child Benefit and pay the charge

You can continue to receive the benefit, then repay some or all of it via your Self Assessment tax return.

• Opt out of receiving payments

You can stop the payments to avoid the charge — but it’s still worth registering for Child Benefit so you don’t miss out on National Insurance credits that count towards your State Pension.

• Plan your income

You may be able to reduce your adjusted net income (for example, by making pension contributions or using salary sacrifice schemes) to stay below £60,000 and keep more of your Child Benefit.

📊 Example

Let’s say you receive Child Benefit for two children (around £2,212 a year) and earn £70,000.

That’s £10,000 over the £60,000 threshold.

For every £200 over, you lose 1% of the benefit.

£10,000 ÷ £200 = 50% of the benefit repayable.

So you’ll owe back around £1,106 through your Self Assessment tax return.

👶 Why It Matters

Many families only find out about this charge when HMRC writes to them years later — often with a demand for backdated payments and penalties.

That’s why it’s so important to review your income each year, especially if bonuses, dividends, or new job roles have changed your financial picture.

📈 How We Help at Your Accounting Club

At Your Accounting Club, we monitor thresholds like this as part of your ongoing tax reviews. If you’re close to the £60,000 mark, we’ll flag it early, explain your options clearly, and help you make informed decisions.

Our goal is always the same — clarity, calm, and care, so you’re never caught off guard by tax surprises.

👋 Need to Check If You’re Affected?

If you or your partner receive Child Benefit and your income is around or above £60,000, we can help you:

• Check whether you owe anything

• Work out how much of your benefit might be clawed back

• Plan your income to reduce the charge going forward

Your Accounting Club — Personal service, practical advice, and peace of mind for every client.

✉️ Comment ‘Join The Club’ or get in touch to see how we can help you stay one step ahead.