Simon Roue and Laura Sant give some quick clarity on Child Benefit vs the Two-Child Cap (often confused in the news).

There is a lot of noise about Child Benefit right now. Most of it blends two different policies. Here is the clean separation so you get clarity and confidence.

1) Child Benefit for all eligible children

• You can claim Child Benefit for each child you are responsible for. There is no limit on the number of children for this entitlement.
• Payments are usually every 4 weeks on a Monday or Tuesday. Weekly payment is possible if you are a single parent or receive certain benefits.
• Claiming safeguards State Pension credits for the carer of a child under 12, even if you later opt out of receiving the cash to avoid a tax charge.

The High Income Child Benefit Charge (HICBC)

• From 6 April 2024 the threshold rose to £60,000 and the taper was halved. Child Benefit is fully clawed back at £80,000 of adjusted net income.
• In practical terms, you repay 1 percent of your Child Benefit for every £200 of income above £60,000.
• HMRC has also introduced a way for some taxpayers to settle the charge via PAYE instead of filing a return only for HICBC.

Fairness quirk you mentioned
The charge is assessed on the higher earner’s individual income, not household income. That is why a single earner on £110,000 repays it all while two partners on £55,000 each do not. Government consulted on moving to a household basis by April 2026, but the policy did not proceed.

2) The Universal Credit two child limit

This is a separate policy that affects the child element of Universal Credit, not Child Benefit.

• Since 6 April 2017, UC does not normally pay a child element for a third or later child born on or after that date, except in specific circumstances such as multiple births or non-consensual conception.
• Public debate about scrapping or relaxing the two child limit relates to Universal Credit only. It does not change the Child Benefit entitlement rules above. Recent DWP statistics show the scale of households affected.

What has changed since April 2024

• HICBC threshold increased to £60,000, with full withdrawal at £80,000.
• Taper is now 1 percent per £200 above £60,000.

What is being talked about in the news

• Political pressure and backbench debates continue on the Universal Credit two child limit. That discussion does not alter the Child Benefit rules for working families covered by HICBC.

What you can do now

Working families near the HICBC threshold

• Check adjusted net income. Salary sacrifice and personal pension contributions can reduce it, sometimes preserving Child Benefit.
• If you prefer not to receive payments because of HICBC, still submit a Child Benefit claim and then opt out of the cash to protect State Pension credits.

Families on Universal Credit

• If you have a third or later child affected by the two child limit, review the list of exceptions and transitional protections.

FAQs

Is Child Benefit paid monthly
Usually every 4 weeks. Weekly is possible for some claimants.

When do I lose Child Benefit to HICBC
The charge starts at £60,000 adjusted net income and removes all Child Benefit by £80,000.

Can I avoid filing a tax return only to pay HICBC
Some people can now settle HICBC through their tax code. Check HMRC’s latest guidance.

Does the two child limit affect Child Benefit
No. It affects the child element in Universal Credit. Child Benefit rules are separate.

This post is general guidance, not personal tax advice. Always take advice on your specific facts.

Contact LSR Partners today to speak with our expert team and pay the right tax, in the right place, at the right time.