Child Benefit is often welcomed as a valuable source of income to those who are raising a child or children. It is important to note the payment can only be claimed by one individual for a child, but there is no limit on how many children can be claimed for. People can expect to be eligible for Child Benefit if they are responsible for bringing up a child who is under 16, or under 20 if they remain in approved education or training.
However, it is worth noting that Child Benefit is income-based, and tax can kick in once Britons earn a certain amount.
The High Income Child Benefit Tax Charge (HICBC) applies to parents who have an individual income of more than £50,000.
The tax is then applied at a taper rate, until income reaches £60,000, at which point all benefit is lost through tax.
There is, though, an important deadline for many Child Benefit recipients to bear in mind when it relates to HICBC.
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If a person does not usually send a tax return, then they will need to register by October 5 following the tax year they are required to pay the charge.
After a person is registered, they can expect to receive a letter informing them of what to do next.
Thankfully, the government has established an online portal for Britons to register for self-assessment to ease the process.
For those affected by the tax charge, there is the option to opt out of receiving Child Benefit.
However, these individuals are still encouraged to fill in the claim form to help them receive valuable National Insurance credits towards their state pension.
Recently, Sarah Coles, personal finance analyst at Hargreaves Lansdown, advised Britons to take action when filing.
She said: “There’s never a good time for a tax deadline, but at the end of almost a year of hell – there’s never been a worse time.
“So it’s worth making a plan for the tax deadline right now, to help you get through it all in one piece.
“It’s a brilliant opportunity to get started – because it gives you time to deal with all the challenges posed this year.
“At this point, you have time to find or re-order any lost paperwork, make sure you claim for everything you can, and if you find the whole thing too much, you should be able to find an accountant to do it for you.”
At present, there are two Child Benefit rates for parents and guardians to bear in mind.
The first relates to an eldest or only child, who is entitled to receive £21.05 per week.
Any additional children will be allocated £13.95 per child, weekly.
The benefit is overseen by HMRC, and more specifically, the Child Benefit Office.
Britons can expect to be paid their Child Benefit sum once every four weeks.