Child Benefit is monitored by HMRC’s Child Benefit Office, to provide those raising children with the monetary support they may need. Child Benefit is available to those responsible for raising a child, either under the age of 16, or under 20 if remaining in approved education or training. It has become particularly valuable for many families amid the lockdown crisis, and the continued rise in the cost of living.
The benefit is issued every four weeks, and there is no limit on how many children a person can claim the benefit for.
It is worth noting, though, that the Child Benefit sum varies from child to child, depending on their position in the family.
The sum is split into two tiers, with the first for only or eldest children, who receive £21.05 in Child Benefit.
Second tier benefits are made available for any subsequent children, at a rate of £13.95 per child.
By claiming Child Benefit, parents and guardians can receive National Insurance credits which can count towards the State Pension.
In addition, any child claimed for under the system will automatically receive a National Insurance number when they turn 16.
However, there is one cut off point to bear in mind for those who are looking to claim the sum from the government.
Parents and guardians who earn over £50,000 are likely to face taxes on the benefit.
This is under a system known as the High Income Child Benefit Tax Charge, which seeks to level the playing field between high earning and lower earning Britons.
The amount of tax one has to pay can vary, however people can use the Child Benefit tax calculator to get an estimate of how much they may be required to pay.
This can be done by visiting the government’s website and entering details of income and allowances.
However, those who earn above £60,000 will face some bad news when it comes to Child Benefit.
The system of progressive taxation means people who earn above this amount will stand to lost all of their benefit.
This is because the sum is taxed at 100 percent once earnings reach this level.
These individuals, however, are still encouraged to fill out and submit the relevant Child Benefit documentation, even if they do not receive the monetary sum itself, so they can continue to hold onto the valuable perks the benefit permits.
The Child Benefit sum was recently given a well-needed boost by the government.
The benefit amount was increased after the lifting of the four-year benefit freeze which affected a wide range of payments.
As a result, Child Benefit has now increased by 1.7 percent, and should rise at the start of each tax year going forward.
Published at Sun, 05 Jul 2020 07:31:00 +0000