Briefing Note - Child Benefit

Income tax charge for those on higher incomes

In the October 2010 Spending Review the Chancellor announced the decision to remove child benefit from families with a higher-rate taxpayer. The concept was reconfirmed in the Budget 2012 statement but with some changes: the trigger point raised from the higher-rate threshold (2012/13 £42,475) to £50,000, a graduated withdrawal for those with incomes between £50,000 and £60,000 and the claw back being by way of a charge on the person with the higher income.

The legislation has effect for the tax year 2012/13 onwards but for 2012/13 the charge only applies to child benefit entitlements for the weeks from 7 January 2013 onwards.

General description of the measure