The High Income Child Benefit Charge — what it is and how the maths works

The High Income Child Benefit Charge — HICBC for short — is a tax charge that effectively claws back Child Benefit when one parent in a household earns above a certain threshold. The rules changed materially in April 2024 and are worth understanding properly, because the numbers and the threshold are different from what most people remember.

The shape of the charge

Child Benefit is paid to whoever claims it (usually the lower earner in the household), at fixed weekly rates per child. The charge isn’t on Child Benefit itself — it’s a separate tax on the higher earner’s adjusted net income, regardless of who actually receives the benefit.

The current thresholds:

• If the higher earner’s adjusted net income is £60,000 or less, no charge applies.
• Between £60,000 and £80,000, the charge tapers in linearly — 1% of the Child Benefit received for every £200 over £60,000.
• At £80,000 and above, the charge equals 100% of the Child Benefit — the household effectively gives all of it back to HMRC.

The thresholds rose from £50,000–£60,000 to £60,000–£80,000 in April 2024 to reflect frozen tax bands and wage inflation, and they sit at those levels for 2026/27. HMRC’s HICBC guidance is the authoritative source.

How “adjusted net income” works

The threshold is based on adjusted net income — broadly your taxable income from all sources, minus a few specific deductions. The most important deductions for HICBC purposes:

• Personal pension contributions (the gross amount, including basic-rate relief added by the provider).
• Gift Aid donations (also grossed up).
• Trading losses.

Workplace pension contributions made by salary sacrifice reduce your salary directly and therefore reduce your adjusted net income automatically — that’s a different mechanism but the effect on HICBC is the same.

So a £75,000 earner who contributes £8,000 into a personal pension (£10,000 gross after relief) has adjusted net income of £65,000, not £75,000. For HICBC, that’s the £65,000 number that counts.

A worked example

Two parents, two children. Weekly Child Benefit at current rates: £26.05 for the first child plus £17.25 for the second — roughly £2,253 a year.

Parent A earns £85,000. Parent B earns £30,000. Parent B claims Child Benefit.

Parent A’s adjusted net income is £85,000, which is above £80,000 — so the HICBC equals 100% of the Child Benefit. Parent A pays £2,253 in extra tax through self-assessment, exactly cancelling out the benefit.

If Parent A contributed £6,000 (£7,500 gross) into a personal pension during the year, adjusted net income would fall to £77,500. The charge would then be:

• (£77,500 − £60,000) / £200 = 87.5%
• 87.5% × £2,253 = £1,971 charge

The pension contribution claws back £282 of the Child Benefit and gives the family an extra £282 net per year — on top of the pension growth and the basic-rate tax relief already inside the pension.

If Parent A contributed £15,000 (£18,750 gross), adjusted net income would fall to £66,250. The charge would be:

• (£66,250 − £60,000) / £200 = 31.25%
• 31.25% × £2,253 = £704 charge

— recovering £1,549 of Child Benefit. And if the contribution were big enough to take adjusted net income below £60,000, the family would keep the full £2,253.

This is why pension contributions are often suggested for families earning in the £60–80k window — the marginal effective tax rate on income in that band is significantly higher than the headline 40%, because every extra £200 of income costs 1% of Child Benefit on top of the income tax.

Who pays — and the self-assessment trap

The charge is owed by the higher-earning parent in the household, regardless of who receives the Child Benefit. This catches blended families and recently-separated couples regularly: a step-parent moving in with a partner who claims Child Benefit for children who aren’t theirs is still on the hook for the charge if their income is the higher of the household.

If you become liable for the HICBC, you have to register for self-assessment by 5 October after the tax year ends, file a return, and pay the charge. Missing the registration deadline can mean penalties on top of the charge itself.

If you’re already in self-assessment for other reasons, just declare the Child Benefit received on the relevant supplementary page.

Should you claim Child Benefit at all if you’re over the £80k cliff?

Even if you’ll pay it all back, claiming Child Benefit is still worth doing — and HMRC actively recommends it — for two reasons:

1. National Insurance credits. The claimant gets NI credits towards their state pension for each year they have a child under 12 in their care. If the claimant isn’t earning (a stay-at-home parent, for example), those credits are how they build a state pension entitlement they’d otherwise miss.
2. Automatic NI number for the child at 16. The Child Benefit registration is how HMRC automatically issues the child a National Insurance number when they turn 16.

The option that gives you both benefits without paying the charge is to claim Child Benefit but opt out of receiving the payments. You tick a box on the claim form. You get the credits and the NI number, and you don’t have to repay anything through self-assessment.

That said — claiming and receiving the money, even if it’s clawed back via HICBC, can be the simpler option if your income is volatile or might dip below £80,000 in a given year. You’d only owe the charge in proportion to what you actually owe.

The non-obvious cases

A few situations where the HICBC catches people out:

1. One-off income spikes. A bonus, redundancy payment, or gain that pushes income above £60,000 for a single year triggers HICBC for that year. The family below in the next year, but the registration and filing obligation are real for the year it happened.
2. Self-employed irregular income. Profits that vary year to year mean HICBC liability varies too — file based on actual income for the tax year.
3. Income just inside the taper. Earning £62,000 means the charge is 10% of Child Benefit — fairly small, but the self-assessment registration obligation still applies.
4. High income from non-PAYE sources. Rental income, dividends from your own company, or investment income all count towards adjusted net income for HICBC purposes.

The bigger picture

The HICBC creates an unusually high marginal tax rate in the £60–80k window — for a family with two children, the effective rate of tax + NI + HICBC on income in that band sits well above 50%. That distortion is the reason pension contributions, salary sacrifice arrangements and other deductions are particularly valuable for families in that bracket.

For households entirely below £60,000, none of this applies. For households cleanly above £80,000, the simple opt-out-but-claim approach removes the admin burden without losing the NI credits. The middle band is where the decision is most interesting.

For more on the related effective-rate trap further up the income ladder, see our guide to the £100k tax trap.

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Last updated 1 June 2026. This guide is educational and is not personal financial advice. Child Benefit amounts and HICBC thresholds are set by HMRC and can change in any Budget — verify current figures on gov.uk before relying on them. See our disclaimer.