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Posted in: Finance Last updated: 06 Apr 2016

Child Benefit

When you have a baby you can claim Child Benefit. In January 2013 new rules came in to effect which mean that the previously universal benefit is now subject to an upper income threshold. This means that not all families will be entitled to the benefit.

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Eligibility

If you meet the income criteria then you should be able to claim Child Benefit for your child or children if they are either:

Only one person responsible for a child can claim Child Benefit for that child including those who are fostering or adopting. However the same parent/carer doesn’t have to claim for all children even if they live in the same home. If you have more than one child eligible and they live in separate homes then they can be claimed for by the same person. Certain rules will apply though.

How to claim

You can get a form for Child Benefit from the 'Bounty' pack that you receive in hospital after the birth. Or you can also fill in Child Benefit forms online or print it out from here».

You'll need the original birth certificate for your baby which has to be sent along with your claim form. Find out more about how to get a birth certificate when registering your baby here».

Child Benefit cannot be backdated by more than three months so try to claim as soon as possible after your baby's birth.

How much and how often?

Child Benefit is a tax-free benefit paid every four weeks. The amount of benefit is £20.70 per week for your first child and £13.70 per week for each of your other children.

Eligibility rules

In addition to the usual rules of eligibility, Child Benefit is now means tested which affects all families where one person earns over £50,000. The benefit will still be paid out in the first instance but any benefit paid out will be reclaimed through a new income tax charge known as the ‘High Income Child Benefit Tax Charge’. In effect, one parent could claim and still receive the benefit but it will be paid back by this tax charge from the higher earner’s income.

Rather than instantly removing all of all of the benefit at the £50k threshold, there will be a slow tapering. So for every £100 earned above £50,000 Child Benefit will be paid back at 1%. This means that regardless of how many children you are claiming for by the time the income reaches £60,000 there will be no Child Benefit left.

This withdrawal process hasn't satisfied or resolved the issue of

inequality if both parents earn just below the £50k threshold. For example if they earned £49,000 per year each (which would give them a combined household income of £98,000) Child Benefit will still be paid out.

Single parent households with just one income but earning just over the £50k limit will also be subject to 'High Income Child Benefit Tax Charge'.

If you separate from your partner part-way through the tax year and your partner's income is over the threshold, the rules of withdrawal will apply up to the date that you split up. After that date your new circumstances will be taken into account and benefit (or a portion of it depending on your own income) may be reinstated.

The gov.uk website has more information about the High Income Child Benefit tax charge here». 

Note: Whilst we take care to ensure Hub content is accurate at the time of publication, individual circumstances can differ so please don’t rely on it when making financial decisions.

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