If you are liable to the High Income Child Benefit charge, you need to decide whether to keep getting Child Benefit payments and declare them, or arrange to stop the payments instead. If you were liable to the High Income Child Benefit charge in a previous tax year but have not stopped the payments, you will have to declare them in a tax return.
On this page:
You have two options:
Your income level may influence your choice because of the amount of tax you might have to pay. So follow the steps below.
Work out your likely tax charge. You can use an online calculator to do this.
Before you use the calculator, it's worth knowing the following:
Your results are only an estimate and are based on the figures you enter. It's worth knowing that:
The calculator doesn't store any of the information you enter: HMRC cannot access the data.
Once you have an idea of your tax charge, talk to any partner you have to see whether it would be better to keep getting the Child Benefit payments or arrange to stop them.
If you don't have a partner then it is up to you whether to keep or stop getting Child Benefit payments.
You will have to pay a tax charge if you, or your partner if they receive Child Benefit, decide to keep getting Child Benefit payments.
You will have to declare these payments by:
You'll normally be registered for Self Assessment if you complete a tax return.
Even if you decide to declare your Child Benefit, you can always change your mind and arrange to stop the payments later on.
You need to register for Self Assessment as soon as possible, and no later than 5 October 2013 for the 2012-13 tax return. If you're late you may have to pay a penalty. You'll need to do this even if you have completed a tax return before - it's the easiest way to make sure that HMRC have all the information they need.
You need to include details of your Child Benefit on your return, starting with 2012-13. You won't be able to complete the shorter paper return (SA200) if you are declaring Child Benefit.
Stopping Child Benefit payments means:
For example, if you are liable to the High Income Child Benefit Charge from 7 January 2013 and stop your Child Benefit payments in September 2013, you will need to complete tax returns for the 2012-13 and 2013-14 tax years. You will need to include the amounts of Child Benefit payments in each tax return.
You will not have to complete a tax return if your Child Benefit payments stop for a whole tax year - unless you need to for other reasons.
It is important to know that:
You can arrange to stop the payments at any time.
If you decide to stop your Child Benefit payments it won’t affect your entitlement to Child Benefit. As long as you, or your partner, are entitled to receive Child Benefit you should still fill in a Child Benefit claim form if you have not already done so.
This is because entitlement to Child Benefit can help protect your entitlement to:
It can also:
If your circumstances change, for example your income level changes or your child leaves home, don't worry. Just remember to report any changes. This applies even if you decided to stop receiving Child Benefit payments.
Changes in your income or Child Benefit entitlement may affect the amount of your tax charge. You can check this at any time by using the online calculator.