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This is a freeview 'At a glance' guide that shows you how to calculate the Child Benefit Tax Charge.

How do you work out the High-Income Child Benefit Tax Charge?

Subscribers see High-Income Child Benefit Tax Charge.

At a glance

Exception:

An election may be made not to receive child benefit if so, the HICBC will no longer apply.

The charge is worked out according to a fraction:

ANI - L % x Child benefit received
    X

Where ANI is adjusted net income for the tax year

L is £50,000, and

X is £100

So, if your income is £55,000 and you receive Child Benefit of £1,752, you will find that your tax charge is £876 (50% of £1,752).

Always round down to the nearest whole number.

This table shows you a step by step method which achieves the same result.

The charge applies on Child Benefit paid on or after 7 January 2013. The charge applies to a taxpayer with income over £50,000 per year if they or their partner are in receipt of Child Benefit in that tax year.

Where income exceeds £60,000 the effect of the charge is that all Child Benefit paid is repaid to the Government.

Take the Child Benefit received in the year

 £

1,752

 £

1,752

 £

1,752

A. Divide by 100

17.52

17.52

17.52

Take actual net income

55,000

60,000

70,000

Deduct base income

(50,000)

(50,000)

 

Excess

5,000

10,000

 

B. Divide by 100

50

100

 

Income tax charge:

 A X B

 

17.52 x 50 =£876

 

17.52 x 100 = £1,752

 

All benefit is repaid £1,752

 

'Adjusted net income'

A person’s adjusted net income for that tax year is determined as follows:


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