The High Income Child Benefit Charge (HICBC) is a tax charge that claws back statutory Child Benefit payments from families where the higher-earning partner has an Adjusted Net Income over £60,000. Under current legislation, every £200 earned between £60,000 and £80,000 claws back 1% of your total Child Benefit, reaching a 100% charge at £80,000. Here is how the taper mathematics works, how it creates a steep marginal tax spike, and how to eliminate the charge legally using pension contributions.
- Threshold Raised to £60,000: Increased from £50,000 in April 2024. Earnings up to £60,000 attract zero clawback.
- Taper Band Extended to £80,000: The charge equals 1% of total Child Benefit for every complete £200 of Adjusted Net Income over £60,000.
- Child Benefit Rates: £26.05/week (£1,354.60/yr) for the eldest child; £17.25/week (£897.00/yr) for each additional child.
- Assessed on Individual Income: Measured against the higher-earning partner alone, regardless of who claims the benefit.
Interactive HICBC Calculator: Requires JavaScript to calculate your exact clawback and marginal tax rate. Check your overall family take-home pay on our Take-Home Pay Calculator or view your full tax bands on our Income Tax Calculator.
1. How the £60,000 to £80,000 Taper Works
Prior to April 2024, the HICBC applied between £50,000 and £60,000 at a steep rate of 1% per £100. Following statutory reforms in the Finance Act 2024, the starting threshold rose to £60,000 and the taper band doubled in width to £80,000.
Under Section 681C of the Income Tax (Earnings and Pensions) Act 2003:
- If your Adjusted Net Income is £60,000 or below, you pay £0.00 in HICBC.
- If your income is between £60,000 and £80,000, your charge percentage is calculated as:
Clawback % = (Adjusted Net Income − £60,000) ÷ £200. - At £80,000 or above, the charge reaches 100% of the total Child Benefit claimed.
2. Worked Hand-Check Example: £65,000 Income (2 Children)
To verify the statutory arithmetic for an earner with two children and a gross income of £65,000 in 2026/27:
HICBC Hand-Check Proof:
- Qualifying Children: 2 children.
- Total Annual Child Benefit: 52 × (£26.05 + £17.25) = 52 × £43.30 = £2,251.60 per year.
- Excess income over threshold: £65,000.00 − £60,000.00 = £5,000.00.
- Clawback percentage: £5,000.00 ÷ £200 = 25.0%.
- HICBC Tax Charge: £2,251.60 × 25% = £562.90.
- Net Child Benefit Retained: £2,251.60 − £562.90 = £1,688.70.
This £562.90 charge must be paid to HMRC by 31 January following the end of the tax year via Self Assessment or a PAYE tax code deduction.
3. The Marginal Tax Rate Trap
Because the HICBC claws back benefit across a £20,000 salary band, it creates a substantial hidden spike in your marginal deduction rate. For a family with two children receiving £2,251.60 per year, losing this benefit over £20,000 represents an extra 11.26% effective marginal tax (£2,251.60 ÷ £20,000 × 100%).
Adding this on top of standard PAYE deductions creates the following marginal rates between £60,000 and £80,000:
- Higher Rate Income Tax: 40.0%
- Class 1 Employee National Insurance: 2.0%
- HICBC Taper Clawback (2 children): 11.26%
- Total Effective Marginal Rate: 53.26% (or 62.26% if repaying a Plan 2 student loan).
4. How to Legally Eliminate the HICBC
The charge is assessed strictly on Adjusted Net Income (ANI), not your headline contract salary. Adjusted Net Income equals total taxable income minus gross personal pension contributions and Gift Aid charitable donations.
If you earn £65,000, making a gross pension contribution of £5,000 (either through workplace salary sacrifice or into a SIPP) brings your Adjusted Net Income down to exactly £60,000.00. This delivers a triple financial win:
- You save £2,000.00 in 40% Higher Rate Income Tax (and £100 in NI if using salary sacrifice).
- You completely wipe out the £562.90 HICBC charge, keeping 100% of your Child Benefit.
- The full £5,000 goes straight into your private pension pot to grow tax-free.
Read our full guide on how salary sacrifice pensions work, or check our Tax-Free Childcare Calculator to see if your household qualifies for the £2,000 government childcare top-up.
Legislative Sources & Methodology
All thresholds and calculations adhere strictly to primary UK legislation:
- Income Tax (Earnings and Pensions) Act 2003, Sections 681B to 681H (High Income Child Benefit Charge).
- Finance Act 2024, Section 10 (Uprating of HICBC thresholds to £60,000 and £80,000).
- Social Security Administration Act 1992 & Child Benefit statutory uprating orders for 2026/27.
Frequently Asked Questions (2026/27)
What is the maximum income to receive Child Benefit?
There is no absolute cap on claiming Child Benefit, but if either parent or partner has an Adjusted Net Income above £60,000, the High Income Child Benefit Charge (HICBC) begins clawing it back. Once the higher earner’s income reaches £80,000, the tax charge equals 100% of the benefit received, wiping it out entirely.
What is the salary limit for Child Benefit in the UK?
The threshold where you keep 100% of your Child Benefit without any tax charge is £60,000 in adjusted net income. Between £60,000 and £80,000, you keep a partial benefit under a 1% per £200 taper. Above £80,000, 100% of the benefit is clawed back via tax.
What is the maximum you can earn before Child Benefit stops?
At £80,000 of adjusted net income, the HICBC charge equals 100% of your entitlement. You can still choose to claim Child Benefit and elect not to receive payments, which preserves National Insurance state pension credits for a non-working parent without having to file a Self Assessment tax return.
What is the maximum income to claim child benefit?
Any family with qualifying children under 16 (or under 20 in approved education) can claim Child Benefit regardless of income. However, families where one partner earns over £80,000 face a 100% tax clawback unless they opt out of receiving payments.
Is Child Benefit based on household income?
No, and this is one of the most controversial features of the system. HICBC is assessed on individual income, not joint household income. A couple where both parents earn £59,000 (household income £118,000) keeps 100% of their Child Benefit, while a single-earner household earning £80,000 loses 100% of it.
Which parent is best to claim Child Benefit?
The parent who is not working or earns less than the National Insurance Lower Earnings Limit (£6,500/year) should always make the claim in their name. Doing so awards them National Insurance credits that protect their qualifying years toward the full UK State Pension.
Do all UK parents get Child Benefit?
Any parent responsible for a child under 16 (or under 20 in full-time non-advanced education) who has the right to reside in the UK qualifies. Payments are not means-tested at the point of application, but higher earners face the HICBC clawback through the tax system.
Does every child in the UK get Child Benefit?
Yes. Child Benefit has no limit on the number of children you can claim for. This is distinct from Universal Credit and Child Tax Credit, which apply a separate two-child limit to means-tested support.
How much is Child Benefit in the UK?
For 2026/27, Child Benefit pays £26.05 per week (£1,354.60 per year) for the eldest or only child, and £17.25 per week (£897.00 per year) for each additional child. For a family with two children, total annual support equals £2,251.60.
How many children can I claim Child Benefit for in the UK?
There is no cap on the number of children you can claim Child Benefit for. You receive £26.05/week for the first child and £17.25/week for every subsequent child (second, third, fourth, etc.).
Does Child Benefit stop at 18 in the UK?
Child Benefit stops on 31 August following the child’s 16th birthday. However, if they remain in approved full-time education (such as A-levels, T-levels, or Scottish Highers) or unpaid approved training, payments can continue until their 20th birthday. It does not cover university or higher education courses.
What actually is the 2 Child Benefit cap?
The ‘two-child cap’ (two-child limit) applies to Universal Credit and Child Tax Credit, restricting child element payments to a maximum of two children for children born after 6 April 2017. It does NOT apply to Child Benefit itself, which pays out for every child in the family.
Did they remove the 2 Child Benefit cap?
No. The two-child limit on Universal Credit and Child Tax Credit remains in UK law. However, Child Benefit itself continues to be paid for all children regardless of family size.
Can a non-British citizen claim Child Benefit?
Yes, provided you are legally resident in the UK, have settled or pre-settled status under the EU Settlement Scheme, or have indefinite leave to remain with no restrictions on public funds. Individuals subject to immigration control with ‘no recourse to public funds’ cannot claim.