Child Benefit High Income Tax Charge Explained (2026/27)

The Child Benefit tax charge (formally the High Income Child Benefit Charge, or HICBC) claws back some or all of your Child Benefit when you or your partner earns over £60,000. In 2026/27, a family with two children receives £2251.60 per year in Child Benefit — but at £80,000 of income, the tax charge wipes out the entire amount. Understanding the sliding scale and the strategies to reduce it can save you over a thousand pounds a year.

This guide covers exactly how the charge is calculated, when you need to file a Self-Assessment return, whether you should keep claiming, and how pension contributions can eliminate the charge entirely. Use the interactive calculator below to see the impact at your income level.

How much is Child Benefit in 2026/27?

Child Benefit is paid weekly to the person responsible for a child under 16 (or under 20 if in approved education or training). The rates for 2026/27 are:

• £26.05/week for your eldest (or only) child — £1354.60/year
• £17.25/week for each additional child — £897.00/year

A family with two children receives £2251.60/year. Three children receive £3148.60/year. The benefit is paid regardless of household income — but the HICBC may claw it back through a separate tax charge on the higher earner.

Beyond the cash, claiming Child Benefit also protects National Insurance credits for the non-working parent (more on this below) and automatically registers your child for a National Insurance number at age 16.^[1]

How much Child Benefit do I lose over £60,000?

The HICBC applies when either parent (or partner living with you) has an adjusted net income above £60,000. It does not matter whose name the claim is in — the charge is always levied on the partner with the higher income. The charge works on a sliding scale between £60,000 and £80,000:

• Below £60,000: no charge — keep 100% of your Child Benefit
• £60,000–£80,000: partial charge — you repay 1% of the total benefit received for every £200 of income above £60,000
• Above £80,000: full charge — you effectively repay 100% of the Child Benefit received

The sliding scale creates 100 steps between £60,000 and £80,000. Each £200 of income above the threshold adds 1 percentage point to the charge. This means the effective marginal “tax rate” on income in this band is higher than it first appears — you're losing Child Benefit on top of paying 40% income tax and 2% NI.^[2]

How is the Child Benefit tax charge calculated?

The charge equals a percentage of the total Child Benefit received in the tax year. The formula is straightforward: divide your income above £60,000 by £200, round down, and that gives the percentage to repay (capped at 100%).

Worked example — income of £70,000, two children (£2251.60/year in benefit):

• Income above £60,000: £10,000
• Number of £200 steps: £10,000 ÷ £200 = 50
• Charge: 50% × £2251.60 = £1125.80
• Net benefit retained: £1125.80 (approximately £94/month)

Use the interactive chart below to see the clawback at your exact income level. The lines show net Child Benefit retained for 1–4 children across the £60,000–£100K income range.

Can pension contributions avoid the Child Benefit charge?

Yes — and this is the single most effective strategy for parents in the £60,000–£80,000 range. Pension contributions (whether personal contributions or salary sacrifice) reduce your adjusted net income. If you contribute enough to bring your adjusted net income to £60,000 or below, the HICBC is eliminated entirely.

The maths is compelling. Say you earn £65,000 with two children:

• Without pension contribution: HICBC of 25% × £2251.60 = £562.90 charged
• With £5,000 pension contribution: adjusted net income drops to £60,000, HICBC = £0
• The £5,000 pension contribution also attracts 40% tax relief = £2,000 saved
• Total benefit: £2563 saved in HICBC + tax relief, while building your pension pot

Salary sacrifice is even more powerful because you also avoid National Insurance contributions on the sacrificed amount — saving an additional 2% (or 8% if below the Upper Earnings Limit). Your employer saves employer NI too, which can make them more receptive to the arrangement.

Use our salary sacrifice calculator to model the exact take-home impact of contributing enough to stay below the £60,000 threshold.

Should I stop claiming Child Benefit?

Even if you would repay 100% of the benefit, there are compelling reasons to continue claiming. The most important is National Insurance credits — the parent who claims Child Benefit and is not working (or earns below the NI threshold) receives Class 3 NI credits towards their State Pension. Each qualifying year adds approximately 1/35th of the full State Pension. Missing these credits can cost thousands in retirement income.

You can opt out of receiving payment while still maintaining the claim itself. This protects NI credits without triggering the HICBC. HMRC calls this “choosing not to get Child Benefit payments.”^[1]

Other reasons to keep claiming even if you repay 100%:

• Automatic NI number at 16. Children are automatically issued a National Insurance number at age 16 if Child Benefit has been claimed for them — saving administrative hassle later.
• Income might fluctuate. If the higher earner's income drops below £60,000 in a future year (job change, maternity leave, career break, redundancy), you'll receive the full benefit without needing to re-register.
• Partial benefit is still valuable. If your income is between £60,000 and £80,000, you keep some of the benefit. At £65,000 with two children, you still retain 75% — over £1,689/year.

Other ways to reduce the charge

Pension contributions are the most common approach, but other strategies also reduce adjusted net income:

• Gift Aid donations — charitable donations under Gift Aid extend your basic rate band and reduce adjusted net income. A £2,000 Gift Aid donation reduces your adjusted net income by £2,000 (£2,500 gross value to the charity).
• Salary sacrifice for childcare, EVs, or bikes — these reduce gross pay and therefore adjusted net income. Particularly relevant for parents who also use salary sacrifice EV schemes.
• Trading losses and property losses — if you have self-employment losses or allowable property losses, these reduce adjusted net income in the year they arise.

The key principle: any deduction that reduces your adjusted net income (not just taxable income) will reduce the HICBC. Adjusted net income is your total taxable income minus pension contributions and Gift Aid — it's not the same as your P60 figure.

Do I need to file a tax return for Child Benefit?

Yes. If you or your partner earns over £60,000 and Child Benefit is being claimed (even if you've opted out of receiving payment), you must file a Self-Assessment tax return. This is required even if all your income is taxed through PAYE and you have never filed a return before.^[3]

The HICBC is reported on the Self-Assessment return and paid by 31 January following the end of the tax year (e.g., the charge for 2026/27 is due by 31 January 2028). HMRC can also collect it through your tax code if the amount is under £3,000, which spreads the payment across the following year's salary.

This catches many parents off guard. If you've recently crossed the £60,000 threshold — perhaps through a pay rise or bonus — you need to register for Self-Assessment by 5 October following the end of the tax year. Late registration can result in penalties.

See the full impact on your finances

Use the income tax calculator to see your complete take-home pay at different salary levels, including the effect of pension contributions on your adjusted net income. The salary sacrifice calculator can model exactly how much pension contribution you need to stay below the £60,000 threshold.

For parents also navigating the £100K Personal Allowance trap, the pension strategy becomes doubly effective — reducing income from £100K+ to below £60,000 eliminates both the HICBC and the Personal Allowance taper simultaneously. See our pension contributions guide for detailed worked examples.

Sources

1. HMRC — High Income Child Benefit Charge. Covers the charge threshold, how to calculate it, and the option to stop payments while preserving NI credits. Accessed June 2026.
2. HMRC — Child Benefit payment rates. Weekly rates for 2026/27: £26.05 (first child), £17.25 (additional children). Accessed June 2026.
3. HMRC — Self-Assessment tax returns. Confirms that anyone liable for the HICBC must file a Self-Assessment return, even if all income is taxed through PAYE. Accessed June 2026.