Households earning more than £60,000 have been warned they may have to repay their Child Benefit. HMRC issued the alert in a social media post on Friday, reminding families about the High Income Child Benefit Charge, which claws back the benefit from higher earners through the tax system.

The non-means-tested payment aims to support families with the cost of bringing up children, giving them £26.05 per week for the eldest or only child, and £17.25 for each additional child until they are 16, or 20 and in approved education or training. However, the Government aims to claw back the money from people who are deemed not to need it.

If you or your partner earns £80,000 or more, you must repay the full amount, and if one person earns between £60,000 and £80,000, the amount repaid increases gradually.

For every £200 earned above the threshold, HMRC will take back 1% of the Child Benefit. For example, if your adjusted net income is £67,600, you would have to pay back 38% of your money. That is because the earnings are £7,600 over the threshold, which is 38 times £200. So effectively, the person may only receive £16.15 per week for the eldest child.

Since the claw-back was introduced, it has come under fire for being based on the income of the highest earner rather than the household’s income, which critics say unfairly punishes single parents or single-income households.

Dual-income families earning £59,000 each, with a household income of £98,000, may not be liable to the HICBC, but a single parent earning over £60,000 could be.

The Government previously stated that the only way to get around the problem would be to introduce some sort of household means test for Child Benefit.

It is worth noting that your income for the purpose of this threshold is not just your salary. You’ll need to work out your ‘adjusted net income’, which includes savings interest and dividends.

HMRC will either adjust your tax code, so the money will be paid back automatically through your regular Income Tax payments (PAYE), or you can pay the tax charge through Self Assessment, depending on your circumstances.

HMRC’s tax revenue has fluctuated since the HICBC was introduced. In the 2022/23 tax year, it received around £525million from 440,000 individuals.