New online HICBC service launched
HMRC have launched a new service for taxpayers liable to the High Income Child Benefit Charge (HICBC), so that they no longer have to register for self-assessment to pay the Child Benefit being recovered.
HICBC applies to households receiving Child Benefit if there is a taxpayer with an adjusted net income above £60,000, and is charged on the higher earner in the household. This is regardless of whether it is them or their partner who claims Child Benefit and still applies even if they do not have parental responsibility for the child(ren) in the Child Benefit claim.
HICBC is charged at a rate of 1% of the Child Benefit received for every £200 of adjusted net income above £60,000. Before April 2024, HICBC applied to those with adjusted net income over £50,000, at a rate of 1% of the Child Benefit for every £100 of adjusted net income above that threshold.
Where the new HICBC service can help
Until recently, taxpayers affected by HICBC have either had to opt out of Child Benefit payments or register for self-assessment by the 5 October following the end of the tax year, in order to declare the liability due via a self-assessment tax return. The 2025 Spring Statement announced a commitment to have the ability for HICBC to be paid in real time via a new service.
Where they have no other reason to complete a self-assessment tax return, the new HICBC service will allow employees to pay their HICBC via PAYE as long as they register for the service by the 31 January after the end of the tax year. But if they have previously been registered for self-assessment, it will be necessary for them to first deregister from self-assessment before using the service.
If they have not already submitted their 2024/25 tax return, individuals signing up for the service will have the option of settling their 2024/25 HICBC and 2025/26 HICBC liability using the new service to adjust their PAYE coding notice. This will result in two HICBC amounts being recovered in the 2025/26 tax year, before reverting to the HICBC being collected in the year that it relates to from 2026/27.
Once an individual has registered for the service, their new PAYE coding notice should normally be issued within 48 hours of submitting the request.
Where there is a change of circumstances
After the taxpayer has signed up, it is understood that any future changes to the Child Benefit claim will then be automatically updated, such as where new children are born or adopted or where children reach the age of 16 (unless they remain in approved education or training).
However, where there is a change of circumstances (such as a change of partner), the individual will have to notify HMRC. At this stage, it is expected that it will be possible to do this using the new HICBC service and then the individual’s PAYE coding notice will be updated accordingly.