Spring Budget Announcement
The chancellor announced during the Spring Budget that the threshold earnings on which the High Income Child Benefit Charge will apply to an individual is set to rise to £60,000.
This is an increase from previous years of £50,000 and will take effect from 6th April 2024. This means that families will be able to earn more income each year without losing any entitlement to child benefit.
The rate at which the charge applies has also been halved, at one percent for every £200 that adjusted net income exceeds £60,000. Therefore the amount that the higher earning individual would need to earn to incur the full charge will now be £80,000 and above.
Government Study Finding
A recent government study has concluded that this change in policy will have a positive impact on around 485,000 families across the UK. Including 170,000 individuals who will no longer need to pay the charge at all.
Benefits for Higher Earners
Those who earn over £50,000 and have elected not to receive child benefit in the past to avoid this charge, may also now be entitled to receive the benefit with no effect to their tax liability.
Future Changes and Considerations
More changes are expected to be announced in the future as the Government moves towards taxation on a ‘household’ basis and not per individual.
Seeking Guidance
If you are currently unsure what these charges in legislation will mean for you and your family, do not hesitate to get in touch with us here at WBV, Swansea and Neath. We will be able to complete a full review of your income and determine if the charge will apply to you and your reporting obligations.
Want to know more about the 2024 Spring Budget? More information is available in our full analysis of the budget.
You can contact us via our website or call us on 01792 652108, our team will be happy to help you.
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