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Child benefit cuts - what it means for you

By citizenmike  |  Posted: January 07, 2013

David Cameron defends the cuts

David Cameron defends the cuts

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CHILD benefit was cut for thousands of households today – and here we explain the changes that the Government has made.

Changes to the rules will reduce the entitlement of about 1.2 million families. Families where one parent is earning more than £50,000 a year will no longer be able to claim the total amount of child benefit. It is expected that couples disclose to each other whether they claim child benefit, or earn above £50,000 a year.

What are the changes?

The plan is to steadily withdraw child benefit from families where one parent earns more than £50,000. The benefit received will be recouped gradually as the income of the highest earning parent rises above £50,000, with the child benefit being taken away completely once their income is £60,000 or more.

How will it effect different families?

One income of less than £50,000: This family keeps the full child benefit, which for two children is £1,752 a year.

One income of more than £50,000: Can keep some benefit but must repay 1 per cent per £100 earned over £50,000. For someone earning £54,000, for example, the charge is £700.

Two incomes, both less than £50,000 each: Although the couple's joint income is over £50,000 they keep all their child benefit as neither one earns over the threshold.

Two incomes, one more than £60,000: Because one partner earns over £60,000 they must either stop claiming or repay the full £1,752 through a tax charge.

How will the Government get the money back from a family with one high earner?

If one of the parents earns more than £60,000, they can choose to stop claiming, or persuade their partner to do so.

If they continue to claim, the higher earner will have to admit this in a self-assessment tax form.

Then, HMRC will tax the high earner on the child benefit which they claim.

Do you have something to say? Leave your comment here...

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  • SG1970  |  January 07 2013, 6:18PM

    Why do we pay this in the first place?

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  • stroppy12  |  January 07 2013, 5:44PM

    Child benefit cuts - what it means for you shouldn't we be asking what it means to cameron and all his toff mates. what happened to....we are all in this together, he dont spout this any more.

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  • SandraPee  |  January 07 2013, 4:42PM

    This looks more and more like causing many injustices . Why not restrict child benefit to the first two children ? Responsible people don't have more children than they can afford . Surely those on £50K+ shouldn't need child benefit . The country is in one hec of a mess and people need to live within their means .

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  • geraint2010  |  January 07 2013, 3:49PM

    It would seem fairer if they had assessed it on household, rather than individual, income. And what's stopping a self employed fellow earning £65,000 a year suddenly making his wife their PA with an apparent pay cheque of £15,000 pa? That said the threshold still seems generously high to me but what do you expect? After all - it's not as if our leaders live in the real world is it?

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  • EllJay1  |  January 07 2013, 3:17PM

    It's not so much the £50,000 - it's the unfairness of the application of it. If one parent earns between £50,000 and £60,000 child benefit will be tapered off to nothing, whereas if two parents each earn just under £50,000 each they keep the benefit.

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  • Studley1975  |  January 07 2013, 2:18PM

    I Still Can't Believe People Could Claim Child Benefit Earning Over £50k A Year. I'd Give Anything To Earn That Much. No Wonder This Country Is In So Much Debt!!! :-0

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  • Barney0123  |  January 07 2013, 1:57PM

    I totally agree with Mr Cameron on this one. Many people use the Child Benefit for other things. My motto is, if you can't afford something you don't have it!!!!!! Sorry but, people need to prioitise...what they 'NEED' nd what they 'WANT'. Neccessaties.... Roof over their head = NEED! Food = NEED, Warmth = NEED.... Luxuries Mobile phone = WANT, Computer = WANT, Latest Fashion = WANT latest Technology = WANT... Sorry if I'm being harsh It's al too easy today for people to get into debt and it's the children who end up suffering. We as a country could also say NO to childrens charities abroad. Look after our own first!!!!! 7 minutes ago

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