The High Income Child Benefit Charge (HICBC) is one of the most resented tax charges in the UK — and one of the most commonly misunderstood. If you or your partner earns between £60,000 and £80,000 and you have children, you are affected. The charge claws back some or all of your Child Benefit through Self Assessment, and many households are caught out because HMRC does not collect it automatically. For 2026/27, the charge starts at £60,000 and reaches 100% at £80,000.
For full Child Benefit rates, see our Child Benefit Rates 2026/27 guide.
Key HICBC Thresholds for 2026/27
| Income | HICBC rate | Child Benefit you keep |
|---|---|---|
| Under £60,000 | 0% | 100% |
| £60,001 | 0.5% | 99.5% |
| £65,000 | 25% | 75% |
| £70,000 | 50% | 50% |
| £75,000 | 75% | 25% |
| £80,000+ | 100% | 0% |
Child Benefit rates 2026/27:
| Children | Weekly amount | Annual total |
|---|---|---|
| 1 child | £26.05 | £1,354.60 |
| 2 children | £43.30 | £2,251.60 |
| 3 children | £60.55 | £3,148.60 |
How the Charge Is Calculated
The HICBC removes 1% of your total Child Benefit for every £200 (or part of £200) your adjusted net income exceeds £60,000.
The formula is:
HICBC = (Child Benefit received) × ((adjusted net income − £60,000) ÷ 200) ÷ 100
The charge applies to the higher earner in a household — not the person who claimed Child Benefit. If your partner claimed it but you earn more, you pay the charge.
“Adjusted net income” is not the same as your salary or taxable income. It is your total income minus pension contributions, Gift Aid donations, and certain other reliefs. This distinction matters — pension contributions are the most common legal way to reduce the charge.
Worked Examples
Example 1: Salary of £65,000, two children
- Child Benefit received: £2,251.60/year
- Income over £60,000: £5,000
- HICBC rate: £5,000 ÷ £200 = 25 steps × 1% = 25%
- Charge owed: £2,251.60 × 25% = £562.90
- Net Child Benefit kept: £2,251.60 − £562.90 = £1,688.70
Example 2: Salary of £70,000, two children
- Income over £60,000: £10,000
- HICBC rate: £10,000 ÷ £200 = 50 steps × 1% = 50%
- Charge owed: £2,251.60 × 50% = £1,125.80
- Net Child Benefit kept: £1,125.80
Example 3: Salary of £78,000, two children
- Income over £60,000: £18,000
- HICBC rate: £18,000 ÷ £200 = 90 steps × 1% = 90%
- Charge owed: £2,251.60 × 90% = £2,026.44
- Net Child Benefit kept: £225.16 — barely worth receiving payments
Example 4: Salary of £80,000+, any number of children
- HICBC rate: 100%
- Every pound of Child Benefit received is repaid through tax
- Net cash benefit: £0
Use our Child Benefit Tax Charge Calculator to calculate your exact charge for any income level.
The Self Assessment Obligation Most People Miss
HICBC is not collected automatically through PAYE. You must register for Self Assessment and declare it on a tax return, even if you have never been self-employed and your employer deducts all your tax.
If you received Child Benefit and your income exceeded £60,000 in any tax year since 2013, you should have been filing a tax return.
HMRC has written to many households affected, but not all. The onus is on you to register.
To comply:
- Register for Self Assessment via HMRC’s website (registration reference takes up to 10 working days)
- File a Self Assessment tax return each year
- Declare the HICBC as part of your tax calculation
- Pay the charge by 31 January following the end of the tax year
If you miss the 31 January deadline, late filing penalties start immediately: £100 for missing the date, rising after 3 months.
For full guidance on the self-assessment process, see our Self Assessment Guide.
The NI Credits Trap — Why You Must Still Claim
This is the most costly HICBC mistake many families make: stopping their Child Benefit claim entirely to avoid the charge.
If the non-working or lower-earning parent is not named on a Child Benefit claim, they receive no National Insurance credits for the time they care for children under 12. These credits count toward the 35 qualifying years needed for a full new State Pension (currently £11,502.40/year).
Each uncredited year can cost £329/year in lost State Pension — for the rest of your life.
The correct approach for higher earners:
- Register for Child Benefit in the name of the non-working or lower-earning parent
- Opt out of receiving the payment — this is a separate step in your HMRC account
- The NI credits still accrue to the claimant
- The higher earner registers for Self Assessment but owes £0 HICBC (since no payment was received)
You can opt back in to receiving payments at any time — for example if your income drops below £60,000.
See our National Insurance Credits Guide for how this works in practice.
How to Reduce or Avoid HICBC
The charge is based on your adjusted net income — and you can legitimately reduce this.
Pension Contributions
Pension contributions reduce your adjusted net income pound for pound.
Example: You earn £72,000 and have two children. Your current HICBC is £2,251.60 × 60% = £1,350.96. If you make an additional pension contribution of £12,000 (reducing adjusted net income to £60,000), your HICBC drops to £0 — you keep all £2,251.60.
The net cost of the £12,000 contribution:
- You get 40% tax relief (higher rate): £4,800 back
- You avoid £1,350.96 HICBC
- Effective cost of contributing £12,000 extra: £5,849.04 — while receiving £12,000 in pension
Salary sacrifice is particularly efficient because it also reduces National Insurance contributions, making the overall saving even greater. See our Pension Tax Relief Guide for the full breakdown.
Gift Aid Donations
Charitable donations under Gift Aid also reduce adjusted net income. A £1,000 Gift Aid donation reduces your adjusted net income by £1,250 (grossed up). This can help push income just below a threshold if you are close to £60,000 or £80,000.
How Much Do I Need to Contribute?
| Current income | Contribution needed to avoid HICBC entirely |
|---|---|
| £65,000 | £5,000 |
| £70,000 | £10,000 |
| £75,000 | £15,000 |
| £80,000 | £20,000 |
The Effective Marginal Rate in the HICBC Zone
For a household with two children, earning in the £60,000–£80,000 range creates a brutal effective marginal tax rate.
On each additional £1 earned between £60,000 and £80,000:
- Income tax at 40%: 40p
- National Insurance at 2%: 2p
- HICBC clawback (2 children): approximately £2,251.60 × 0.5% per £100 = ~11.26p per £100 earned, or about 5.6% effective clawback rate per child-benefit-equivalent
For a family with two children, the effective marginal rate in this zone is approximately 55–57%. Every extra pound earned costs you more than half in combined deductions. This is the core reason pension contributions make such strong mathematical sense in this income range.
What to Do If You Haven’t Been Paying HICBC
If you received Child Benefit while earning over £60,000 and have not been declaring the charge, act now.
HMRC can go back up to four tax years and charge interest on unpaid HICBC. If you disclose voluntarily before they contact you, penalties are typically lower than if HMRC discovers the liability first.
Steps to take:
- Register for Self Assessment immediately at gov.uk
- File returns for all open tax years where HICBC applied
- Pay any tax, interest, and penalties owed
- Set up future years correctly — either continue receiving Child Benefit and filing returns, or opt out of payments (see above)
For guidance on dealing with HMRC after missing payments, see our HMRC Payment Plan Guide.
HICBC and Couples — Who Pays the Charge?
The HICBC is paid by the higher earner in the household — not necessarily the person who claimed Child Benefit. This catches many couples by surprise.
If your partner claimed Child Benefit (as most do) but you earn £75,000 and they earn £30,000, you pay the HICBC — even though you didn’t claim the benefit and may not even know how much they receive.
If both partners earn over £60,000, the charge applies to the one with the higher adjusted net income.
For the full picture on tax in your income band, see our Income Tax Guide and the section hub at Income Tax.