How it’s calculated
HMRC’s current thresholds start above £60,000 of individual adjusted net income. Use the higher partner income, not combined household income. Each complete £200 above £60,000 adds 1%, capped at 100% at £80,000. Multiply the actual benefit by this percentage and round the charge down to whole pounds. The 2026/27 weekly rates are £27.05 for the first child and £17.90 for each additional child. The default £2,337.40 represents two children for 52 weeks; replace it with your actual taxable-year benefit.
Worked example
With incomes of £70,000 and £40,000, the charge percentage is 50%. On £2,337.40 benefit the whole-pound charge is £1,168, leaving £1,169.40. At £60,199 the charge percentage is still zero; at £60,200 it becomes 1%.
Before you use the result
Adjusted net income includes taxable benefits, savings and dividends, less eligible reliefs. Use gross pension relief correctly and avoid subtracting salary sacrifice twice. Changes of partner, part-year entitlement and competing claims need HMRC’s detailed calculation. Reducing one partner’s income may leave the other liable. Opting out of payments does not mean you should ignore a claim that could protect National Insurance credits.
Frequently asked questions
Is the threshold based on household income?
No. It uses individual adjusted net income. Where both partners exceed the threshold, the higher-income partner is generally liable.
Can pension contributions reduce the charge?
Eligible pension relief can reduce adjusted net income. Recalculate both partners’ incomes and use HMRC’s definition.
Why enter actual benefit instead of only a child count?
Births, changing entitlement and part-year claims can change the amount. Actual tax-year benefit avoids assuming every child qualified for 52 weeks.