HMRC’s online service to pay the High Income Child Benefit Charge (HICBC) through Pay As You Earn (PAYE) is now live.
The service was announced at the Spring Statement 2025 and aims to reduce the need for some taxpayers to complete self assessment solely to settle the charge.
HICBC applies where the claimant or their partner has adjusted net income above the threshold. From the 2024/25 tax year, the threshold is £60,000, with child benefit fully withdrawn at £80,000. The clawback is 1% of the benefit for every £200 income over £60,000.
Previously, HICBC payers reported the charge via self assessment, with limited coding-out through PAYE for amounts under £2,000. Under the new approach, PAYE taxpayers who only file a return to pay HICBC can opt out of self assessment and pay via PAYE instead. To use the service, individuals must first de-register from self assessment; access should be available the following day.
HMRC plans to write to around 100,000 people who appear liable but are not in self assessment. In 2022/23, about 440,000 individuals were liable to HICBC. HMRC notes a risk of two HICBC amounts appearing in one year’s PAYE code where liabilities span 2024/25 and 2025/26, depending on timing.
Households can also opt out of receiving child benefit payments. Registration can still be beneficial, however, as it provides National Insurance credits for non-working parents and triggers a child’s NI number before age 16.
Your questions answered
Who does the High Income Child Benefit Charge (HICBC) apply to?
You are liable to pay this charge if either of you receives the Child Benefit, and at least one of you has an adjusted net income greater than the £60,000 threshold. There is a 1% clawback for every £200 earned over the threshold, with the Child Benefit fully withdrawn at £80,000. If your adjusted net income is over the threshold and so is your partner’s, then whoever has the higher income is responsible for paying the tax charge.
How can you pay your HICBC under the new system?
Whilst payment of the HICBC previously required self assessment, this can now by paid via PAYE instead (however this requires opting out of the self assessment).
Should you still register for Child Benefit?
Opting out of Child Benefit, especially if both partners are above the threshold, would avoid being exposed to the HICBC, however, receiving of the Benefit is not the only advantage to being registered. This triggers the child’s NI number before the age of 16, as well as providing NI credits to non-working parents to protect their state pensions.
