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Child benefit changes take effect | Child benefit changes take effect |
(about 5 hours later) | |
More than a million better-off families will lose some or all of their child benefit, under changes which came into force at midnight. | More than a million better-off families will lose some or all of their child benefit, under changes which came into force at midnight. |
Families with one parent earning more than £50,000 lose part of their child benefit and it will be fully withdrawn where one parent earns above £60,000. | Families with one parent earning more than £50,000 lose part of their child benefit and it will be fully withdrawn where one parent earns above £60,000. |
The government hopes to save £1.5bn a year to help reduce the deficit. | The government hopes to save £1.5bn a year to help reduce the deficit. |
David Cameron described the move as "fundamentally fair" but Labour said it was a "huge assault" on families. | David Cameron described the move as "fundamentally fair" but Labour said it was a "huge assault" on families. |
Defending the policy, the prime minister said: "I'm not saying those people are rich, but I think it is right that they make a contribution. | Defending the policy, the prime minister said: "I'm not saying those people are rich, but I think it is right that they make a contribution. |
"If we don't raise that... from that group of people - the better off 15% in the country - we would have to find someone else to take it from." | "If we don't raise that... from that group of people - the better off 15% in the country - we would have to find someone else to take it from." |
Shadow chancellor Ed Balls said the government should tax the richest, rather than make changes that affect those on middle incomes, and described the changes as a "complete shambles". | Shadow chancellor Ed Balls said the government should tax the richest, rather than make changes that affect those on middle incomes, and described the changes as a "complete shambles". |
Nearly 200,000 high earners have already opted out of receiving child benefit but several hundred thousand others who missed a deadline to declare they will no longer qualify will now have to fill in self-assessment tax forms. | |
Campaigners say this has created complexity in the system. | Campaigners say this has created complexity in the system. |
They have also pointed to the fact that a family where two parents work and both earn £49,000 a year will keep their benefits, while a family with a single earner on £51,000 - where the other parent may have chosen to stay at home in a caring role - will lose part of theirs. | They have also pointed to the fact that a family where two parents work and both earn £49,000 a year will keep their benefits, while a family with a single earner on £51,000 - where the other parent may have chosen to stay at home in a caring role - will lose part of theirs. |
Simpler | Simpler |
Child benefit is paid at the rate of £20.30 a week for the first child, and then £13.40 a week for each child after that. | Child benefit is paid at the rate of £20.30 a week for the first child, and then £13.40 a week for each child after that. |
It lasts until each child reaches 16, or 18 if they are still in full-time education, and in some cases until they are 20. | It lasts until each child reaches 16, or 18 if they are still in full-time education, and in some cases until they are 20. |
More than a million people are set to be affected by the cut, with the Institute of Fiscal Studies estimating that they would lose an average of £1,300 a year. | More than a million people are set to be affected by the cut, with the Institute of Fiscal Studies estimating that they would lose an average of £1,300 a year. |
Any child benefit paid to high-earners who have failed to opt out will be clawed back through the High Income Child Benefit Charge, administered by HM Revenue and Customs. | Any child benefit paid to high-earners who have failed to opt out will be clawed back through the High Income Child Benefit Charge, administered by HM Revenue and Customs. |
If somebody earning more than £50,000 or their partner keeps claiming child benefit, then the higher earner will have to admit this in a self-assessment tax form. The IFS estimates that 500,000 extra people might have to fill in these forms as a result of the change. | If somebody earning more than £50,000 or their partner keeps claiming child benefit, then the higher earner will have to admit this in a self-assessment tax form. The IFS estimates that 500,000 extra people might have to fill in these forms as a result of the change. |
A Treasury spokesman said: "Withdrawing child benefit on the basis of the combined family income would require intrusive means-testing of all eight million households getting child benefit. The way we are doing it is simpler for the vast majority of families." | A Treasury spokesman said: "Withdrawing child benefit on the basis of the combined family income would require intrusive means-testing of all eight million households getting child benefit. The way we are doing it is simpler for the vast majority of families." |
But the stance has not been welcomed by many people who would be affected. | But the stance has not been welcomed by many people who would be affected. |
Paul, from West Sussex, who has a six-year-old son was one of a number of people who reportedly failed to receive a letter from HMRC explaining the options for higher earners on what to do. | Paul, from West Sussex, who has a six-year-old son was one of a number of people who reportedly failed to receive a letter from HMRC explaining the options for higher earners on what to do. |
He told the BBC: "My salary goes up and down, but we will continue to claim it. But my tax affairs are very simple so the one thing I don't really want to do is the self-assessment thing." | He told the BBC: "My salary goes up and down, but we will continue to claim it. But my tax affairs are very simple so the one thing I don't really want to do is the self-assessment thing." |
The deadline has now expired for higher earners to opt out of receiving child benefit. They will still be able to do so, but may still face a tax charge for the time still in the system since 7 January. | The deadline has now expired for higher earners to opt out of receiving child benefit. They will still be able to do so, but may still face a tax charge for the time still in the system since 7 January. |
The latest official figures from HM Revenue and Customs show that 191,873 people have opted out of receiving child benefit - mostly because they know they will consistently earn more than £60,000 a year, or earn over £50,000 and do not want to be pulled into the self-assessment system. | The latest official figures from HM Revenue and Customs show that 191,873 people have opted out of receiving child benefit - mostly because they know they will consistently earn more than £60,000 a year, or earn over £50,000 and do not want to be pulled into the self-assessment system. |
Are you affected by the changes to child benefit? Please send us your experiences by filling in the form below. | Are you affected by the changes to child benefit? Please send us your experiences by filling in the form below. |