The high income child benefit charge (HICBC) claws back child benefit in full where the adjusted net income of the highest earner in the household exceeds the upper threshold. There is a tapered withdrawal of child benefit where the income is between the lower and upper thresholds. HICBC is paid through self assessment. However, rather than deal with HICBC, the person may have chosen not to claim child benefit, or may have made a claim and chosen not to receive any payments.  

As announced at Spring Budget 2024, the lower threshold is increased from £50,000 to £60,000, and the upper threshold from £60,000 to £80,000, from 6 April 2024. The legislation providing for the changes is included in Finance (No. 2) Bill 2024. In light of these changes, a person who opted not to claim or receive child benefit may now wish to reconsider their position. 

For example, a person earning £65,000 per year will have the full amount of child benefit clawed back for 2023/24. Rather than having to pay HICBC, they may have chosen not to receive child benefit. For 2024/25, HICBC will claw back only 25% of the child benefit. Therefore, the person may wish to consider claiming child benefit to keep 75% of it.  

Claiming child benefit 

A person can claim child benefit, or opt to receive payments having made a claim earlier, by using HMRC’s app or online claim form. Child benefit is backdated for three months, or to the date of birth of the child if later. For HICBC purposes, backdated claims will fall into 2023/24 if the claim is made before 6 April 2024 and into 2024/25 if the claim is made on or after 6 April 2024 and before 5 April 2025.  

Continuing with the example of a person with income of £65,000 above, and assuming the person makes a child benefit claim on 6 May 2024, the backdated payments from 6 February 2024 to 5 April 2024 will fall into 2024/25. But had a claim been made before 6 April 2024, the backdated payments would have been clawed back as the person’s income exceeds the minimum threshold for 2023/24. 

If a person has claimed child benefit but doesn’t currently get payments and wants to restart them, they should choose carefully from when to restart the payments. If they start them before 6 April, they may have to pay the HICBC for 2023/2024.   

The government estimates that around 180,000 families that do not claim or receive child benefit will benefit from the changes taking effect from 6 April 2024. 

There may be other advantages to claiming child benefit depending on the circumstances. For example, claiming child benefit can protect a person’s entitlement to contributory benefits, such as the state pension. This is because a parent who has been awarded child benefit for a child under 12 may be awarded class 3 national insurance contribution (NIC) credits automatically.  

The government has acknowledged that some parents who have not claimed child benefit could miss out on their future entitlement to a full state pension. In January 2024, the government announced that it will legislate to introduce a route for parents and carers to apply for NIC credits where they have not claimed child benefit. This is expected to be available from April 2026.  

Other changes to HICBC 

It was announced at Spring Budget 2024 that the government will consult on changing the basis on which HICBC is applied. At present, HICBC is applied by reference to the individual’s income. The government intends to change this to the household’s income by April 2026.  

Further guidance:

• HMRC’s Information on changes to the high income child benefit charge