Child Benefit

Child Benefit – How It Can Help And What To Look Out For

Child benefit can be a useful help for many families.

Currently (2023/24 tax year) paid at £24 per week for your first child and £15.90 per week for any further children. This equates to £1,200 per year for your first child and £800 per year for additional children.

You can claim Child Benefit online and it is important to get the form in as soon as possible. Child Benefit can only be backdated 3 months, so if you claim after your baby is 3 months old you will have missed out on some of the benefits you are entitled to.

Alongside the actual payments, the other reasons to claim Child Benefit are:

1. Your child will automatically be issued with a National Insurance number before their 16th birthday.
2. If you have stopped work to raise your children, claiming Child Benefit will ensure that you get National Insurance credits towards your State Pension, which could have a large impact on the amount of income you have later in life.
3. Claiming Child Benefit allows you to then claim other benefits such as Guardian’s Allowance (a benefit you can claim if you’re bringing up a child whose parents have died).

Everyone can claim Child Benefit BUT there are tax implications for those who earn over £50,000 (changing to £60,000 on 6th April 2024), which may mean that you choose not to receive the actual payments.

High Income Child Benefit Charge is applied if either parent earns over £50,000. (Increasing to £60,000 on 6th April)

– You’ll need to pay back 1% of your family’s Child Benefit for every £100 of your income over £50,000. (Increasing to £60,000 on 6th April)

– If either of you earns over £60,000 a year, you’ll have to repay all your Child Benefit in extra Income Tax. (This upper limit will increase to £80,000 from 6th April 2024)

-There are ways to reduce the tax due on Child Benefit. You can do this by making additional pension contributions which reduces your adjusted net income.

If you have an income over £60,000 and you are not able to bring this down through additional pension contributions you can opt not to receive the payments rather than have to pay it all back through a tax bill.

It is still important to claim Child Benefit so you can benefit from the State Pension credits and ensure that your child gets their National Insurance number automatically before they are 16.