If you or your partner earns over £60,000, you could be losing some or all of your child benefit to the HICBC. Here is how it works, what the thresholds are, and how to keep every penny.
The High Income Child Benefit Charge (HICBC) is a tax charge that claws back child benefit from families where one parent earns more than £60,000 per year. It was introduced in 2013 (originally at £50,000) and has been a source of frustration for families ever since.
The charge is based on individual income, not household income. A couple where both parents earn £59,000 each (£118,000 household income) keeps their full child benefit. A single-earner household where one parent earns £65,000 (£65,000 household income) loses some of it. This asymmetry is widely criticised but remains the law.
From 2024/25, the threshold increased from £50,000 to £60,000, and full repayment now occurs at £80,000 (previously £60,000). This change removed around 170,000 families from the charge entirely.
In 2025/26, child benefit rates are:
First child: £26.05 per week (£1,354.60 per year)
Each additional child: £17.25 per week (£897.00 per year)
A family with two children receives £2,251.60 per year. A family with three children receives £3,148.60. This is significant money — and it is worth fighting to keep.
Annual child benefit by family size (2025/26):
1 child: £1,354.60 2 children: £2,251.60 3 children: £3,148.60 4 children: £4,045.60
If the higher-earning partner's adjusted net income is between £60,000 and £80,000, they repay 1% of child benefit for every £200 of income over £60,000.
Example: You earn £70,000 with two children. Income over threshold: £10,000. Number of £200 bands: 50. Charge: 50% of £2,251.60 = £1,125.80. You keep: £1,125.80.
Example: You earn £65,000 with one child. Income over threshold: £5,000. Number of £200 bands: 25. Charge: 25% of £1,354.60 = £338.65. You keep: £1,015.95.
At £80,000 or above, 100% of child benefit is repaid — you receive it only to hand it back through self-assessment.
Use our tax calculator to see your exact child benefit position alongside your income tax and NI calculations.
If you are liable for HICBC, you must register for self-assessment and file a tax return — even if you are fully taxed through PAYE and have never filed before. HMRC can charge penalties for failing to register.
Many families discover this years later and face backdated charges plus interest. If you earn over £60,000 and receive child benefit, check your self-assessment status now.
Alternatively, you can opt out of receiving child benefit entirely to avoid the self-assessment requirement. But read the next section before you do.
If the charge would claw back 100% of child benefit (income over £80,000), opting out saves you the hassle of filing a self-assessment return. But there is a critical catch.
National Insurance credits: The parent who claims child benefit receives NI credits towards their State Pension for each year they are not working or earning below the NI threshold. If the non-earning or lower-earning parent is not the child benefit claimant, they miss these credits — potentially reducing their State Pension by thousands over their lifetime.
The solution: continue to claim child benefit (even if it will be fully clawed back) but tick the box to not receive payments. This preserves the NI credits without triggering any payment or charge. This is the recommended approach for most families where the higher earner is well above £80,000.
Always claim child benefit — even if you will repay it. The NI credits for the non-working or lower-earning parent are too valuable to lose. Just tick the box to not receive payment if the charge equals 100%.
The HICBC is based on adjusted net income, which means the same strategies that reduce your income tax also reduce the child benefit charge:
Pension contributions: A £10,000 personal pension contribution reduces your adjusted net income by £10,000. If you earn £70,000, this brings you to £60,000 — completely eliminating the charge. Combined with the 40% tax relief on the contribution, you save both the £1,125 child benefit charge and £4,000 in tax.
[Salary sacrifice](/blog/salary-sacrifice-calculator-uk): Even more effective because your contractual salary is reduced, so you also save NI. A £10,000 salary sacrifice from a £70,000 salary eliminates the child benefit charge AND saves approximately £4,200 in tax and NI.
Gift Aid: Grossed-up Gift Aid donations reduce your adjusted net income. A £4,000 net donation (£5,000 grossed up) reduces your adjusted net income by £5,000.
Sarah earns £75,000 and has two children. Her partner earns £30,000. Without action:
Child benefit received: £2,251.60. HICBC charge: 75 × 1% = 75% of £2,251.60 = £1,688.70. Net child benefit kept: £562.90.
Sarah sets up salary sacrifice of £15,000 into her pension. Her adjusted net income drops to £60,000.
HICBC charge: £0 (income at threshold). Child benefit kept: £2,251.60 (full amount).
Additional tax saved (40% on £15,000): £6,000. NI saved (2% on £15,000): £300. Child benefit preserved: £1,688.70.
Total annual benefit of salary sacrifice: £7,988.70. The £15,000 is not lost — it is in her pension, growing tax-free for retirement.
Model your own scenario in our calculator to see the combined savings.
Because HICBC is based on individual income, couples where both parents earn below £60,000 are not affected — even if household income is well above £120,000. This creates planning opportunities.
If one partner earns £90,000 and the other earns £30,000, consider whether income can be redistributed. Options include: the higher earner maximising pension contributions (or salary sacrifice) to bring income below £60,000 if possible, or the lower earner taking on investments or rental property income rather than the higher earner.
Also consider who claims the child benefit. It should be the lower-earning partner (for NI credits), while the higher earner is the one assessed for HICBC. In many families, the wrong partner is the claimant — check and switch if needed.
HICBC is not the only cost of earning over £60,000. If either parent earns over £100,000, the family also loses eligibility for Tax-Free Childcare (up to £2,000/child/year) and the 30 free hours of childcare (worth up to £9,400/child/year).
This £100,000 cliff edge is separate from HICBC but compounds the problem for higher-earning parents. Our comprehensive 60% trap guide covers the full impact of crossing £100k, including both childcare losses and the personal allowance taper.
1. Check your exposure. Use our calculator to see your exact HICBC liability.
2. Consider pension contributions to bring your adjusted net income below £60,000 (or as close as possible).
3. Ask about salary sacrifice — it saves more than personal contributions for the same result.
4. Do not opt out of child benefit unless you fully understand the NI credit implications. Claim it and choose not to receive payment instead.
5. Register for self-assessment if you are liable for the charge and have not already.
6. Review which partner claims — the lower earner should be the claimant for NI credit purposes.