2021 Autumn Budget Representation – High Income Child Benefit Charge
In our 2021 Autumn Budget representation, we repeat our calls for the government to raise the £50,000 threshold for the high income child benefit charge (HICBC) to at least £60,000. We argue that the £50,000 threshold is untenable now it has been overtaken by the higher-rate threshold from 6 April 2021, as basic-rate taxpayers can now be liable to the charge. This is contrary to the original policy intent.
We also recommend that the point at which child benefit is fully withdrawn is increased from £60,000 to at least £75,000, in order to mitigate the disproportionate effect of the charge on larger families.
Finally, we urge the government to make changes to ensure that low-income taxpayers do not lose on out National Insurance credits as a result of not claiming child benefit where the charge is applicable.
Our submission can be found here.