Child benefit tax calculator
What the household receives, how much the high income charge takes back, and what is left.
- Child Benefit for the year
- £0
- High income charge
- £0
- Left with
- £0
How the charge works
Child Benefit is paid to everyone who claims it, whatever they earn. The High Income Child Benefit Charge then takes some of it back through the tax system if the higher earner in the household has adjusted net income above £60,000.
The claw-back is 1% of the benefit for every £200 of income above £60,000. At £70,000 that is half of it. At £80,000 it is all of it, and above £80,000 the charge simply equals the benefit, so there is nothing further to lose.
It looks at one income, not the household's
Only the higher earner's income matters. Two people earning £55,000 each, £110,000 between them, pay nothing at all. One person earning £70,000 with a partner earning nothing pays half of it back. This is the most criticised feature of the charge, and it has survived several reviews, so plan around it rather than expecting it to change.
Claim anyway, even at £80,000
Above £80,000 the charge cancels the benefit exactly, so it is tempting not to bother. That reasoning misses the second thing a claim does: it credits your National Insurance record while you are caring for a child under twelve, and those credits count towards your State Pension.
The answer is to claim and opt out of receiving the payments. You keep the credits, you pay no charge, and you do not need to file for it. A parent out of work who never claims can quietly lose years off their State Pension record, which is worth far more than the benefit was.
A pension contribution moves the line
The charge is measured on adjusted net income, which is your income after pension contributions and Gift Aid come off. A contribution therefore reduces the charge as well as your income tax, pound for pound.
Between £60,000 and £80,000 with two or more children, the combined effect of income tax, National Insurance and the withdrawn benefit produces a marginal rate that can pass 60% and keep climbing with each additional child. Contributing enough to get back to £60,000 is unusually good value in that band.
Common questions
- Whose income counts?
- The higher earner in the household, not the two added together. A couple each earning £55,000 pays nothing. A single earner on £70,000 with a partner on nothing pays half the benefit back. That asymmetry is the most criticised part of the charge and it is how the rule works.
- Should I just stop claiming?
- Usually no, and this is the expensive mistake. Claiming and paying the charge back leaves you no worse off than not claiming, but a claim also credits your National Insurance record while you are caring for a child under twelve, which counts towards your State Pension. You can claim and opt out of the payments to keep the credits without the charge.
- What is adjusted net income?
- Broadly your taxable income after pension contributions and Gift Aid are taken off. That is the lever: a pension contribution reduces adjusted net income pound for pound, so it can pull you back under the threshold and remove the charge as well as saving income tax.
- How do I actually pay it?
- Through Self Assessment. If you are liable and do not already file a return, you have to register for one, which catches people out. HMRC has been introducing a route to collect it through PAYE instead, so check your position before assuming you must file.