One of the longstanding criticisms of the High Income Child Benefit Charge (HICBC) is that it forces individuals to register for self-assessment, even when all their income is taxed under PAYE. For many, this meant filing tax returns solely to repay a small portion of child benefit — often unnecessarily complicating things. But that’s about to change.
The government has announced plans to allow employed individuals to pay the HICBC via their PAYE tax code, removing the need to register for self-assessment. While a precise date for the change hasn’t been confirmed, the draft Finance Bill released in July included this provision, and further details are expected soon.
This change will be especially welcome for families whose income falls into the new HICBC range — those earning between £60,000 and £80,000 — many of whom were previously required to file tax returns despite having relatively straightforward tax affairs.
What Is the HICBC?
Child benefit is paid to families regardless of income — currently £24.00 per week for the first child and £15.90 for each additional child (2023/24 rates). However, since 2013, the government has used the HICBC to reduce or claw back child benefit from higher earners.
As of April 2024, the HICBC begins when an individual or their partner earns over £60,000. The charge reduces child benefit by 1% for every £200 of income above this threshold. Once income reaches £80,000, 100% of the benefit is effectively reclaimed.
Why the Change Matters
Previously, the HICBC applied from £50,000 to £60,000, catching many middle-income families. In 2020/21, around 355,000 people were affected — many of whom failed to realise they had to register for self-assessment, triggering HMRC compliance checks and, in some cases, penalties.
Although HMRC has taken a softer stance on penalties in recent years, the administrative burden remained a major frustration — especially for people earning just over the threshold.
By allowing the charge to be collected automatically through PAYE, the government is addressing both fairness and simplicity. It should reduce the need for tax returns and the risk of accidental non-compliance — a long-overdue improvement to a policy often criticised for its complexity and poor communication.
For families impacted by HICBC, this update is more than a technical tweak — it’s a step toward a fairer and more user-friendly system.
Check your numbers
To calculate your Net Adjusted Income to see how the HICBC affects you, you can use our UK Self Assessment Calculator at TaxGrid.