HM Revenue and Customs (HMRC) has confirmed a £60,000 rule for the 2026/27 tax year that will see households hit with an extra tax charge. The rule affects Child Benefit claiming households with earnings of £60,000 or more, with those who exceed this threshold subject to pay the High Income Child Benefit Charge (HICBC).
How the High Income Child Benefit Charge Works
The HICBC applies if either you or your partner receives Child Benefit and at least one of you earns more than £60,000 per year. In this case, you will have to pay back some of your Child Benefit to HMRC at a rate of 1% for every £200 of earnings above £60,000. In cases where claimants or their partner earns £80,000 or more, then all of the Child Benefit must be repaid to HMRC.
Determining Responsibility
If your adjusted net income is over the threshold and so is your partner’s, then whoever has the higher income is responsible for paying the tax charge. ‘Partner’ refers to someone you’re not permanently separated from who you’re married to, in a civil partnership with or living with as if you were.
HMRC Official Statement
Confirming the rule for the new 2026/27 tax year, HMRC said: “From tax year 2024 to 2025 onwards, if you or your partner earn more than £60,000 a year, you’ll have to pay some of your Child Benefit back. If you or your partner earn £80,000 or more, you’ll have to pay all of it back.”
“You’ll pay back 1% of your Child Benefit for every £200 you earn over the threshold. Example: Your adjusted net income is £67,600 in tax year 2024 to 2025. This is £7,600 over the £60,000 threshold. As 7,600 divided by 200 is 38, you’ll pay back 38% of your Child Benefit.”
Options for Claimants
If your income exceeds the threshold, you can choose to either get Child Benefit payments and pay the tax charge, or opt out of getting payments and not pay the tax charge. If you do opt to pay the tax charge, this can be done through your PAYE tax code or through Self Assessment.
Earlier Warning
Earlier this year, HMRC issued a tax warning reminder to households claiming Child Benefit that received a pay rise at the start of the new tax year in April, as it could push some claimants into the HICBC band. In a post on X, HMRC said: “Attention parents! Recently had a pay rise? If you’re now earning over £60k and you get Child Benefit you may need to pay some of it back.”
Child Benefit Payment Increases for 2026/27
Child Benefit claimants have seen a boost to payments for the 2026/27 tax year, with rates rising by 3.8% on April 6, adding an extra £1 per week for the first child and an extra 65p per week for each subsequent child. The new weekly rates are now £27.05 per week for the first or eldest child, and £17.90 for any additional children - an annual increase of £52 and £33.80 respectively. Over a full year, this amounts to a total of £1,406.60 per year for the eldest or only child, and an additional £930.80 per year for each additional child, with no limit as to how many children parents can claim for.
