Summary of the new Child Benefit Rules from Tuchbands, Accountants in North London
The new Child Benefit rules came into effect this month for weekly periods beginning after 7 January.
Wherever there is a household in which child benefit is claimed and someone is earning over £50,000 a year, some or all of the child benefit will have to be paid back.
Child benefit is currently £20.30 a week for the first child and £13.40 for each subsequent one.
The £50,000 income is not just salary. It is total taxable income including self employed earnings and investment income. Any clawback of the benefit will be assessed through self assessment and becomes payable on 31 January following the end of the tax year in which the clawback arose.
Where a clawbck arises and the person is not registed for self assessment, they will need to notify the Revenue that they will have a liability by 5 October following the end of the tax year. Failure to notify could give rise to penalties.
Needless to say, that their will be more publicity as we move through 2013. This is only the “tip of the iceberg” as, like everything in tax, there is a lot of detail associated with these new rules.
Written by Philip Woolfson
Philip is a Partner of Tuchbands, a dynamic firm of accountants based in North London. Philip has handled accounts and taxation for a wide range of industries, from property investment through to the fashion industry and in his 35 years has helped hundreds of businesses to thrive in both rising and falling markets.