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Published on 23 May 2024

Finance (No. 2) Bill 2023-24 – Briefing on high income child benefit charge changes


LITRG has issued a briefing to MPs on clause 5 of the Finance (No. 2) Bill 2023-24, which covers changes to the high income child benefit charge from 6 April 2024. 

Various UK bank notes and coins.

From 6 April 2024, the clause increases:

  • the adjusted net income threshold at which the high income child benefit charge starts to apply, from £50,000 to £60,000, and
  • the threshold at which child benefit is clawed back entirely via the charge, from £60,000 to £80,000. 

There is also an administrative easement to prevent backdated child benefit payments triggering a charge in 2023/24.

We say that the increase in both thresholds is a welcome step. However, the increase to the first threshold does not compensate entirely for inflation to date. The increase to the second threshold reduces the impact on marginal rates for those with income between the two thresholds, but broadens the band of taxpayers who are affected by those higher marginal rates and who would need to file a tax return because of the charge. 

In Spring Budget 2024, the government also announced its intention to move assessment of the charge to a household basis from April 2026. While the detail is not yet available, we are concerned that this could be complex, costly and difficult to achieve through the tax system. We encourage a wider review of the policy so that the Government can clarify its objectives and explore how best to achieve them. 

You can read LITRG’s full submission using the link provided. 

LITRG’s submission

Tom Henderson
Technical Officer 

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