Cookies are small text files that are stored on your computer when you visit a website. They are mainly used as a way of improving the website functionalities or to provide more advanced statistical data.
Child benefit claw-back
Newsletter issue - March 2015.
If you or your spouse/partner claim child benefit, and at least one of you has adjusted net income of £50,000 or more for the year, the highest earner must declare the benefit on their tax return in order to pay back part or all of the child benefit as a tax charge.
HMRC is writing to taxpayers who it thinks should have paid the child benefit tax charge for 2013/14, but didn't. Unfortunately some people who have received such letters are childless, or haven't claimed child benefit for decades.
If you have received one of those letters by mistake, don't ignore it. HMRC can alter your tax return to collect the tax it thinks is due. You need to reject any such incorrect alteration to your tax assessment within 30 days, but we can help you do this.
If you do earn over £50,000 and want to keep your child benefit for 2014/15 there are a number of things you can do.
First, work-out your adjusted net income. This is your gross salary before tax, less expenses that have not been reimbursed by your employer, but which are tax deductible, such as the cost of travelling to a temporary workplace and professional subscriptions. The self-employed should start with taxable profits and deduct trading losses. Any profits from let property, gross amounts of interest and dividends must also be included.
Next, deduct the grossed-up amount of donations made under Gift Aid, and grossed-up pension contributions made to personal pension schemes. Paying more pension contributions or making additional Gift Aid donations before 6 April 2015 can reduce your adjusted net income, and hence preserve your child benefit.
Remember only 1% of the child benefit is clawed-back for every £100 of adjusted net income above £50,000, so you might lose only a small amount of the child benefit as a tax charge.
Charities & Not For Profit
We have been providing charity clients with high quality, specialist advice and service for many years, and our charity clients range from small village halls to large national organisations...
Farming Industry
The largest industry sector that we deal with is farming, as you would expect in a rural practice. This means that we have developed considerable expertise in this field...
Business News
