Child benefit charge
In this lesson, you'll learn how the child benefit charge works and when you'll need to repay some or all of the child benefit you've received during the tax year. This is a key area for TX (Taxation) and affects higher-earning individuals, so understanding the calculation method is essential for exam success.
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In this lesson
- 0:00 Child benefit tax charge overview
- 0:25 How the charge is calculated
- 0:47 Full charge threshold at £80,000
- 1:41 Worked example: Pippa's child benefit charge
- 3:04 Worked example: Kerry's adjusted net income calculation
About this lesson
The child benefit charge applies when you or your partner has adjusted net income over £60,000. The charge is calculated at 1% of the child benefit received for every £200 of income above £60,000, with a full 100% clawback once income reaches £80,000 or more. You'll work through the adjusted net income calculation—which includes employment income and interest, minus gross personal pension contributions—and then apply this to determine what percentage of child benefit must be repaid through self-assessment. The lesson covers two worked examples that show how the charge operates in practice: a straightforward scenario with salary income, and a more complex case involving multiple income sources and pension contributions. By the end, you'll be confident calculating the charge accurately and understanding when it applies to different family circumstances.
Duration: 4m
Transcript
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