How does the high income child benefit charge work?
Answered 11 March 2026
Here is a comprehensive explanation of how the High Income Child Benefit Charge (HICBC) works.
What the law says
The charge is found in s.681B and s.681C of the Income Tax (Earnings and Pensions) Act 2003 (ITEPA 2003), introduced by the Finance Act 2012.
Who is liable?
A person ("P") is liable to a charge to income tax for a tax year if:
- P's adjusted net income (ANI) exceeds £60,000 (from 6 April 2024; previously £50,000), and
- One or both of the following conditions are met:
| Condition | Description |
|---|---|
| Condition A | P is themselves entitled to child benefit for a week in the tax year, and no partner of P has a higher ANI |
| Condition B | P's partner ("Q") is entitled to child benefit for a week in the tax year, and P has a higher ANI than Q |
In short, the higher earner in a couple pays the charge, even if it is their partner who actually receives the child benefit.
How is the charge calculated?
The charge is the "appropriate percentage" of the total child benefit received (s.681C ITEPA 2003):
- 100% of child benefit received, or
- If less, the percentage given by the formula:
((ANI − L) / X) %
Where:
- ANI = P's adjusted net income
- L = £60,000 (the lower threshold)
- X = £200 (the taper divisor)
Any fractions are rounded down to the nearest whole number.
This means the charge tapers from 0% at £60,000 ANI to 100% at £80,000 ANI (i.e., the full child benefit is clawed back once ANI reaches £80,000).
Previous rates (before 6 April 2024)
The thresholds were lower: the taper ran from £50,000 (L) with a divisor of £100 (X), meaning the full charge applied at £60,000 ANI.
Adjusted Net Income (ANI)
ANI is defined at s.58 of the Income Tax Act 2007 and is calculated as follows:
- Start with the individual's net income (s.23 ITA 2007)
- Deduct the grossed-up amount of any Gift Aid donations
- Deduct gross pension contributions relieved at source
- Add back any relief for payments to trade unions or police organisations
Treasury power to alter thresholds
The Treasury may by order substitute different amounts for the lower threshold (L) or the taper divisor (X), subject to parliamentary approval where the change increases tax liability.
HMRC guidance / practice
The charge in practice
Where a customer or their partner has ANI over £60,000, the person with the higher income is liable to a tax charge on some or all of the child benefit they or their partner are entitled to receive.
Summary of rates:
| Period | Taper | Full charge |
|---|---|---|
| 7 Jan 2013 – 5 Apr 2024 | 1% per £100 over £50,000 | At £60,000+ |
| From 6 Apr 2024 | 1% per £200 over £60,000 | At £80,000+ |
Opting out of payments
To avoid the charge, the child benefit claimant can elect not to receive payments. They remain entitled to child benefit (preserving NI credits, for example) but receive no payments, and therefore neither they nor their partner need to declare or pay the charge. This election has been available from 7 January 2013.
If an election is made, the charge may still apply to child benefit already received up to the date the election takes effect.
Effect of property/trading income allowances on ANI
- If an individual claims full relief under the property income allowance or trading allowance, that income is excluded entirely from the ANI calculation for HICBC purposes.
- If an individual claims partial relief, only the income not covered by the allowance counts towards ANI.
Self Assessment
The charge is reported and paid through Self Assessment. The first year the charge applied was 2012–13, with the first balancing payment due by 31 January 2014.
Citation sources
High income child benefit charge Increase in thresholds to £60,000 and £80,000 5 1 In— a section 681B(1)(a) of ITEPA 2003 (liability to high income child benefit charge if person’s adjusted net income exceeds £50,000), and b section 681C(2)(b) of that Act (amount of the charge), in the definition of “L” , for “£50,000” substitute £60,000”. 2 In section 681C(2)(b) of that Act, in the definition of “ X ” (which, in combination with the other parts of the formula, secures that there is a taper in t
ch accompanies and forms part of this decision notice. RACHEL GAUKE TRIBUNAL JUDGE Release date: 14th MARCH 2023 APPENDIX: RELEVANT LEGISLATION Section 681B of the Income Tax (Earnings and Pensions) Act 2003 (high income child benefit charge): “(1) A person ("P") is liable to a charge to income tax for a tax year if (a) P's adjusted net income for the year exceeds 50,000, and (b) one or both of conditions A and B are met. (2) The charge is to be known as a "high income child benefit charge". (3)
Part 10 Social security income CHAPTER 8 High income child benefit charge Alteration of income limit etc by Treasury order 681F 1 The Treasury may by order— a substitute another amount for the amount for the time being specified in section 681B(1)(a) and defined as “L” in section 681C(2), or b substitute another amount for the amount defined as “X” in section 681C(2). 2 An order under this section has effect for tax years beginning after the order is made. 3 A statutory instrument containing an
Legislation in The Finance Act 2012 stipulates a new tax charge, the High Income Child Benefit Charge (HICBC), may apply to a Child Benefit (ChB) customer if they or their partner have an individual adjusted net income of over £50,000 a year, for the duration of all the claimant’s ChB payments. Partner is taken to mean whom the ChB customer lives or lived with. The ChB claimant or partner with the highest annual adjusted net income is affected. The charge first comes into effect on 7 January 201
net income of more than £60,000, the person with the higher income will be liable to a tax charge on some or all the Child Benefit they, or their partner are entitled to receive. Where a customer or their partner is liable to the High Income Child Benefit Charge, the Child Benefit customer can either decide to opt not to receive their Child Benefit payments. This means they remain entitled to Child Benefit but do not receive payment and so they, or their partner, do not have to declare the Child
From 7 January 2013, a Child Benefit claimant may elect not to get further Child Benefit payments if that claimant expects that they or another person would be liable to a High Income Child Benefit Charge. If the claimant makes an election not to get Child Benefit payments, they or their partner (if the higher earner) may need to pay High Income Child Benefit Charge for Child Benefit already received up to the date the election takes effect.
Part 10 Social security income CHAPTER 8 High income child benefit charge High income child benefit charge 681B 1 A person (“P”) is liable to a charge to income tax for a tax year if— a P's adjusted net income for the year exceeds £60,000 , and b one or both of conditions A and B are met. 2 The charge is to be known as a “high income child benefit charge”. 3 Condition A is that— a P is entitled to an amount in respect of child benefit for a week in the tax year, and b there is no other person wh
When considering the High Income Child Benefit calculation, regulations refer to an individual’s adjusted net income which is defined at S58 of Income Tax Act (ITA) 2007. The definition is based on an individual’s ‘Net Income’ as defined at S23 ITA 2007 which will be reduced by any amount of the property income allowance that an individual uses. If an individual is entitled to Full Relief, then they do not need to count the income to which the allowance relates when considering whether they are
Part 10 Social security income CHAPTER 8 High income child benefit charge The amount of the charge 681C 1 The amount of the high income child benefit charge to which a person (“P”) is liable for a tax year is the appropriate percentage of the total of— a any amounts in relation to which condition A is met, and b any amounts in relation to which condition B is met. For conditions A and B, see section 681B. 2 “The appropriate percentage” is— a 100%, or b if less, the percentage determined by the f