If you or your partner receive Child Benefit and the higher earner's adjusted net income is over £60,000, HICBC claws some of it back: 1% of the benefit for every £200 over the threshold, until at £80,000 the whole benefit is repaid. The charge falls on the higher earner, who may need to file Self Assessment just to pay it.
Because Child Benefit is worth £26.05 a week for the first child in 2026/27, a parent in the taper faces a steep effective marginal rate. Pension contributions and salary sacrifice reduce adjusted net income and can restore the benefit. Work your position out with the Child Benefit Tax Calculator.
A family with two children receives £43.30 a week in Child Benefit, £2,251.60 a year. If the higher earner is on £70,000, the charge claws back 50% (£1,126). A £10,000 gross pension contribution brings adjusted net income down to £60,000 and the whole clawback disappears, making the pension contribution cost far less than its headline amount.
