Guide · 4 minute read · Updated 10 Jul 2026

How does the High Income Child Benefit Charge work?

The High Income Child Benefit Charge (HICBC) is a tax that gradually takes back Child Benefit once the higher earner in a household passes £60,000. This guide is about the charge mechanics; if you are still deciding whether to claim, see the should I claim Child Benefit over £60k guide.

The taper: £60,000 to £80,000

The charge is based on adjusted net income, which is your total taxable income less pension contributions and Gift Aid donations. It applies to whichever partner has the higher adjusted net income, even if the other person is the one who claims the benefit.

For every £200 of adjusted net income above £60,000, you repay 1% of the Child Benefit received. Because £200 into £20,000 goes 100 times, the benefit is fully clawed back by £80,000. Below £60,000 there is no charge; above £80,000 the charge equals the entire benefit, so you keep nothing.

A worked example

Child Benefit in 2026/27 is £27.05 a week for the eldest child and £17.90 for each other child. A family with two children receives about £2,337 a year.

Suppose the higher earner has an adjusted net income of £70,000. That is £10,000 over the threshold. Divide by £200 and you get 50, so the charge is 50% of the benefit: about £1,169. The family keeps roughly half.

Push income to £80,000 and the charge becomes 100% of £2,337, wiping the benefit out. At £64,000 with one child, the charge is 20% (£4,000 over, divided by £200) of £1,407, which is about £281. The charge always tracks your income in £200 steps, so a modest pay rise into this band can cost more than it first appears.

How the charge is collected

You settle the charge in one of two ways. The traditional route is Self Assessment: you register, file a return, and pay by 31 January after the tax year. Since October 2025 there is a simpler option for employees and pensioners. If you do not otherwise need to file, you can ask HMRC to collect the charge through your PAYE tax code, so it comes out of your salary across the year with no return to complete.

Either way, you must actively deal with it. The charge does not appear automatically, and failing to report it has led to penalties for people who did not realise they were caught.

Pension contributions are the main lever

Because the charge keys off adjusted net income, and pension contributions reduce that figure, paying more into your pension can shrink or remove the charge entirely.

Take the £70,000 earner above. Paying £10,000 (gross) into a pension brings adjusted net income down to £60,000, so the charge disappears and the family keeps the full £2,337. The pension contribution also attracts higher-rate tax relief, so you are rewarded twice: the charge falls and the tax bill falls. Salary sacrifice into a pension does the same job and saves National Insurance too. Model it in the salary sacrifice calculator. The key point is that "income" for this charge is not your gross salary; it is a figure you can legitimately manage.

Common questions

At what income does the High Income Child Benefit Charge start?

At £60,000 of adjusted net income. Between £60,000 and £80,000 the charge claws back 1% of your Child Benefit for every £200 over £60,000. At £80,000 or above the charge equals the whole benefit, so none is kept.

How is the High Income Child Benefit Charge calculated?

Take your adjusted net income above £60,000, divide by £200, and that percentage of your Child Benefit is the charge. On £70,000 with two children (about £2,337 of benefit), that is 50%, so a charge of roughly £1,169.

Can I pay the charge through my tax code instead of Self Assessment?

Yes, since October 2025. If you do not otherwise need a Self Assessment return, you can ask HMRC to collect the charge through PAYE, spread across the year in your tax code. Otherwise you report and pay it through Self Assessment by 31 January.

Can pension contributions reduce the charge?

Yes. The charge is based on adjusted net income, which is reduced by pension contributions and Gift Aid. A £70,000 earner paying £10,000 into a pension drops to £60,000 and avoids the charge entirely, while also getting higher-rate tax relief.

Guidance and education, not regulated financial advice.