{"id":19556,"date":"2019-07-18T10:55:29","date_gmt":"2019-07-18T10:55:29","guid":{"rendered":"https:\/\/smh.group\/?p=19556"},"modified":"2023-02-15T13:39:21","modified_gmt":"2023-02-15T13:39:21","slug":"parents-receive-hmrc-penalties-reprieve","status":"publish","type":"post","link":"https:\/\/devstagesite.co.uk\/smhgroup\/parents-receive-hmrc-penalties-reprieve\/","title":{"rendered":"Parents receive HMRC penalties reprieve"},"content":{"rendered":"\n<h3 class=\"wp-block-heading\"><strong>Around\n6,000 parents have had their penalties cancelled for failure to notify HMRC\nthat they were liable for the high income child benefit charge (HICBC). This is\nunlikely to be repeated, so families need to be aware of their position.<\/strong><\/h3>\n\n\n\n<p>Around\n1.4 million families lose some or all of their child benefit because one of the\nparents earns over \u00a350,000 a year. As soon as one\npartner earns over \u00a350,000, child benefit is gradually withdrawn via a tax\ncharge. The whole benefit is lost once earnings exceed \u00a360,000. <\/p>\n\n\n\n<p>One of the main criticisms of the HICBC has\nbeen around its practical implementation, with many more taxpayers drawn into\nself-assessment who had previously been taxed through PAYE. By tying the charge\nto the higher earner in a family, who is generally not the person claiming the\noriginal child benefit, HMRC is also applying the charge to the family income\nthrough an individual. The onus is on the individual higher earner to notify\nHMRC when they tip over the threshold.&nbsp;&nbsp; <\/p>\n\n\n\n<p>Since the 2013\/14 tax year \u2013 when the\ncharge was introduced \u2013 35,000 families have received failure to notify\npenalties for liabilities through 2015\/16. Following a number of challenges,\nHMRC instigated a review of all the failure to notify penalties issued. Where\nthey found a \u2018reasonable excuse\u2019 for a failed notification under certain\ncriteria, penalties would be cancelled or refunded. In the end, of the 6,000\ncancellations, 4,885 received refunds. <\/p>\n\n\n\n<h4 class=\"wp-block-heading\"><strong>How it works<\/strong><\/h4>\n\n\n\n<p>The \u00a350,000 HICBC threshold applies to each\nindividual. The benefit is paid in full, for example, if both parents earn\n\u00a345,000 (creating a joint income of \u00a390,000). But as soon as one parent earns\nover \u00a350,000 \u2013 even if the other does not work \u2013 they\u2019ll be hit by this charge.\nParents can opt out of receiving child benefit, but they should still register\nto receive National Insurance credits if one partner is not working.<\/p>\n\n\n\n<p>The tax charge can be reduced by increasing <strong><span style=\"text-decoration: underline;\"><a href=\"https:\/\/devstagesite.co.uk\/smhgroup\/financial-services\/retirement-solutions\/personal-pensions\/\">pension contributions<\/a><\/span><\/strong> to reduce taxable pay to below the relevant threshold in some cases. Remember though, money in a pension cannot be accessed until at least age 55. <\/p>\n\n\n\n<p>HMRC has said that for tax years from 2016\/17,\nthey expect the higher earner in a couple to notify them where their income\nexceeds the HICBC threshold, on the assumption that any parent claiming child\nbenefit since the charge was introduced will now be aware of it. <\/p>\n\n\n\n<p>If you have any questions about your family\u2019s <strong><span style=\"text-decoration: underline;\"><a href=\"https:\/\/devstagesite.co.uk\/smhgroup\/chartered-accountants\/taxation\/\">tax position<\/a><\/span><\/strong>, contact one of our <strong><span style=\"text-decoration: underline;\"><a href=\"https:\/\/devstagesite.co.uk\/smhgroup\/chartered-accountants\/\">Accounting &#038; Business Advisory<\/a><\/span><\/strong> a line on <strong>0114 266 4432<\/strong> or <strong><span style=\"text-decoration: underline;\"><a href=\"mailto:info@smhca.co.uk\">info@smhca.co.uk<\/a><\/span><\/strong>.<\/p>\n","protected":false},"excerpt":{"rendered":"<p>Around 6,000 parents have had their penalties cancelled for failure to notify HMRC that they were liable for the high income child benefit charge (HICBC). This is unlikely to be repeated, so families need to be aware of their position.<\/p>\n","protected":false},"author":4,"featured_media":17175,"comment_status":"closed","ping_status":"open","sticky":false,"template":"","format":"standard","meta":{"_acf_changed":false,"inline_featured_image":false,"footnotes":""},"categories":[3,4],"tags":[209,211,324,11,24,19,14,323],"class_list":["post-19556","post","type-post","status-publish","format-standard","has-post-thumbnail","hentry","category-smh-accounting-business-advisory","category-chartered-tax-advisers","tag-child-benefit","tag-hicbc","tag-high-income-child-benefit-charge","tag-hmrc","tag-pensions","tag-tax","tag-tax-planning","tag-taxation"],"acf":[],"yoast_head":"<!-- This site is optimized with the Yoast SEO plugin v26.9 - https:\/\/yoast.com\/product\/yoast-seo-wordpress\/ -->\n<title>Parents receive HMRC penalties reprieve - SMH Group<\/title>\n<meta name=\"robots\" content=\"noindex, follow, max-snippet:-1, max-image-preview:large, max-video-preview:-1\" \/>\n<meta property=\"og:locale\" content=\"en_GB\" \/>\n<meta property=\"og:type\" content=\"article\" \/>\n<meta property=\"og:title\" content=\"Parents receive HMRC penalties reprieve - SMH Group\" \/>\n<meta property=\"og:description\" content=\"Around 6,000 parents have had their penalties cancelled for failure to notify HMRC that they were liable for the high income child benefit charge (HICBC). This is unlikely to be repeated, so families need to be aware of their position.\" \/>\n<meta property=\"og:url\" content=\"https:\/\/devstagesite.co.uk\/smhgroup\/parents-receive-hmrc-penalties-reprieve\/\" \/>\n<meta property=\"og:site_name\" content=\"SMH Group\" \/>\n<meta property=\"article:published_time\" content=\"2019-07-18T10:55:29+00:00\" \/>\n<meta property=\"article:modified_time\" content=\"2023-02-15T13:39:21+00:00\" \/>\n<meta property=\"og:image\" content=\"https:\/\/devstagesite.co.uk\/smhgroup\/wp-content\/uploads\/2018\/10\/family-income-benefit-header.jpg\" \/>\n\t<meta property=\"og:image:width\" content=\"1653\" \/>\n\t<meta property=\"og:image:height\" content=\"450\" \/>\n\t<meta property=\"og:image:type\" content=\"image\/jpeg\" \/>\n<meta name=\"author\" content=\"Brendan Hall\" \/>\n<meta name=\"twitter:card\" content=\"summary_large_image\" \/>\n<meta name=\"twitter:label1\" content=\"Written by\" \/>\n\t<meta name=\"twitter:data1\" content=\"Brendan Hall\" \/>\n\t<meta name=\"twitter:label2\" content=\"Estimated reading time\" \/>\n\t<meta name=\"twitter:data2\" content=\"2 minutes\" \/>\n<script type=\"application\/ld+json\" class=\"yoast-schema-graph\">{\"@context\":\"https:\/\/schema.org\",\"@graph\":[{\"@type\":\"Article\",\"@id\":\"https:\/\/devstagesite.co.uk\/smhgroup\/parents-receive-hmrc-penalties-reprieve\/#article\",\"isPartOf\":{\"@id\":\"https:\/\/devstagesite.co.uk\/smhgroup\/parents-receive-hmrc-penalties-reprieve\/\"},\"author\":{\"name\":\"Brendan Hall\",\"@id\":\"https:\/\/devstagesite.co.uk\/smhgroup\/#\/schema\/person\/637129b7464f960037f1b676f625570e\"},\"headline\":\"Parents receive HMRC penalties reprieve\",\"datePublished\":\"2019-07-18T10:55:29+00:00\",\"dateModified\":\"2023-02-15T13:39:21+00:00\",\"mainEntityOfPage\":{\"@id\":\"https:\/\/devstagesite.co.uk\/smhgroup\/parents-receive-hmrc-penalties-reprieve\/\"},\"wordCount\":413,\"image\":{\"@id\":\"https:\/\/devstagesite.co.uk\/smhgroup\/parents-receive-hmrc-penalties-reprieve\/#primaryimage\"},\"thumbnailUrl\":\"https:\/\/devstagesite.co.uk\/smhgroup\/wp-content\/uploads\/2018\/10\/family-income-benefit-header.jpg\",\"keywords\":[\"Child Benefit\",\"HICBC\",\"High income child benefit charge\",\"HMRC\",\"Pensions\",\"tax\",\"tax planning\",\"taxation\"],\"articleSection\":[\"SMH Accounting &amp; 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