The child benefit tax charge
Child benefit is paid to the parent, but once either parent earns over £60,000 the government starts taking it back through a tax charge. By £80,000 the whole payment is gone. The charge is quiet, it lands through your tax return or your tax code, and it pushes your real tax rate higher than the headline bands suggest.
Reviewed for the 2025/26 and 2026/27 tax years.
How the charge works
The charge is called the High Income Child Benefit Charge. It is worked out on your own income, not the household total, so it is the higher earner of a couple who pays it. For every £200 of income above £60,000 you repay 1% of the child benefit your family received, so by £80,000 you are repaying 100% of it.
The amount at stake grows with the number of children, because the charge is a percentage of the full child benefit you claim. That is why the same salary bites harder for a larger family.
What it does to your real tax rate
Between £60,000 and £80,000 the charge sits on top of the tax and National Insurance you already pay. Each extra pound of income costs you 40% income tax, National Insurance, and a slice of your child benefit on top, so your marginal rate in this band is well above the 40% the tax tables show. The more children you have, the steeper it gets.
How to keep your child benefit
The charge is measured against the same adjusted income as the £100,000 trap, so the same move fixes it. A pension contribution or a Gift Aid donation lowers the income the charge is worked out on, and every pound you bring back under £80,000 buys some of your child benefit back until, at £60,000, the charge disappears entirely.
You do not have to stop claiming. Some families opt out of the payments to avoid the charge, but if a pension contribution brings your income down you can keep both the payments and the money you put by for retirement.
See what it costs you
Put your salary and your number of children into the calculator and it shows the charge for your own situation, your real marginal rate, and what a pension contribution would do to both.