Child Benefit Tax Charge Calculator

The HICBC applies if you or your partner has adjusted net income over £60,000 and either of you claims child benefit. The higher earner pays the charge via Self Assessment. From April 2024 the threshold was raised from £50,000 to £60,000, with full clawback at £80,000 (previously £60,000). You must register for Self Assessment if you earn over £60,000 and are receiving child benefit.

Adjusted net income is your total income minus certain reliefs — most importantly personal pension contributions (relief at source) and Gift Aid payments. Salary sacrifice pension contributions reduce your gross pay before this is calculated, making them particularly effective for people near the £60,000 threshold. Importantly, it is the individual income of each partner that matters, not household income.

Many people with income over £80,000 opt out to avoid the charge and the Self Assessment requirement. However, even if you opt out of payments, you should still register your claim — doing so protects your National Insurance record (child benefit comes with NI credits) and preserves your child's entitlement to a National Insurance number. You can opt out of receiving payments while keeping the claim active.

Pension contributions are the most effective tool — they reduce your adjusted net income pound for pound. Making a £5,000 pension contribution when you earn £65,000 brings your adjusted net income to £60,000, restoring your full child benefit. Gift Aid donations also reduce adjusted net income. Check whether your employer offers salary sacrifice to make pension contributions even more tax-efficient.