The High Income Child Benefit Charge
How it works and what to take note of
If anyone in your household claims child benefit, this charge belongs in your tax planning. It claws back child benefit when the higher earner's adjusted net income passes £60,000, and removes it entirely at £80,000.
How it works
The charge is 1% of the child benefit for every £200 of adjusted net income above £60,000, applied to whichever partner earns more, regardless of who actually claims the benefit. It is collected through your Self Assessment return or, if you choose, through your tax code.
Directors take note
Salary, dividends, rental income and benefits in kind all count towards adjusted net income. Because you control the timing and amount of your dividends, the charge is often plannable in a way it is not for employees.
💡 Good to know: If the charge would wipe out the benefit, you can register for child benefit but opt out of payments. This protects the claimant's state pension credits with no charge to pay.
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