HICBC — High Income Child Benefit Charge 2026/27

HICBC 2026/27 — the £60,000 lower threshold, £80,000 full clawback, how the 1% per £200 taper works, and pension-contribution mitigation with worked examples.

If anyone in your household claims Child Benefit and the highest earner has adjusted net income (ANI) above £60,000, some or all of the benefit is clawed back through the High Income Child Benefit Charge — or HICBC. This guide covers the 2026/27 rules, the April 2024 reform that lifted the thresholds, and the levers you can pull to reduce or eliminate the charge.

The HICBC thresholds for 2026/27

ThresholdAmountWhat happens
Lower£60,000HICBC starts — 1% of Child Benefit for every £200 over
Upper£80,000Full clawback — 100% of the benefit recovered as HICBC

Between the two thresholds the charge tapers linearly:

HICBC = Child Benefit received × (ANI − £60,000) ÷ £20,000

Rounded up to the nearest whole pound per £200 step.

These thresholds were raised from £50,000/£60,000 to £60,000/£80,000 in April 2024 (Spring Budget 2024) and have held flat through 2025/26 and 2026/27. There’s no announced change coming.

Who pays the HICBC: the charge is paid by the highest earner in the household above the £60,000 threshold, whether or not they personally claim the Child Benefit. Only one person pays — the partner with the higher ANI, calculated at the end of the tax year through self-assessment.

Adjusted net income — what actually counts

The £60,000 threshold isn’t gross salary. It’s adjusted net income (ANI) — HMRC’s specific measure:

  • Gross income from all sources (salary, self-employment, rental, investment, pension, etc.)
  • Minus pension contributions you make from your own money (relief at source gross-up, or net pay arrangement)
  • Minus Gift Aid donations (grossed-up)
  • Minus trading losses carried forward
  • Plus chargeable event gains on life insurance policies
  • Plus pre-tax investment income

Key implication: pension contributions directly reduce ANI. A £10,000 salary sacrifice pension contribution pulls your ANI down by £10,000, potentially taking you out of the HICBC band entirely.

Worked examples for 2026/27

Example 1 — salary £65,000, two children

Child Benefit 2026/27 rates (gov.uk): £26.05/week eldest + £17.25/week each additional = £43.30/week = £2,251.60/year.

  • ANI £65,000 → £5,000 over the £60,000 threshold
  • Steps: £5,000 ÷ £200 = 25 steps of 1% = 25% of benefit clawed back
  • HICBC: 25% × £2,251.60 = £562.90
  • Net household gain from Child Benefit: £2,251.60 − £562.90 = £1,688.70

Example 2 — salary £75,000, one child

Benefit: £26.05/week × 52 = £1,354.60/year.

  • ANI £75,000 → £15,000 over
  • 75% clawback: £15,000 ÷ £200 = 75 × 1% = 75%
  • HICBC: 75% × £1,354.60 = £1,015.95
  • Net gain: £1,354.60 − £1,015.95 = £338.65

Example 3 — salary £82,000, one child

ANI above £80,000 → 100% clawback. You lose the full £1,354.60 benefit through the HICBC. At this level, Child Benefit and its clawback perfectly cancel — you still get the cash during the year, but self-assessment claws it all back.

Example 4 — mitigate with pension

Same person as example 2 (£75,000 salary, one child) puts £15,000 into a workplace pension via salary sacrifice.

  • Gross salary: £75,000
  • Pension sacrifice: −£15,000
  • ANI: £60,000 — exactly on the lower threshold
  • HICBC: £0
  • Pension contribution also saves Income Tax (40% relief) and NI (8% relief)
  • Net take-home vs the no-pension scenario drops less than the £15,000 gross amount would suggest

Real numbers for your salary on the pension calculator — the HICBC effect is baked into the take-home calculation when Child Benefit is entered.

Opting out of Child Benefit

If your ANI is firmly above £80,000 you can either:

  1. Keep claiming and pay back 100% through HICBC — completes one self-assessment each year.
  2. Opt out of payments but keep the claim registered — HMRC still records your Child Benefit, you keep your National Insurance credits (important for state pension if you’re a stay-at-home parent), and you don’t need to file self-assessment for HICBC.

Option 2 is usually better for simplicity if you’re nowhere near the lower threshold and don’t plan to drop back below £80,000 soon.

You can reverse the opt-out at any time via gov.uk/child-benefit or by contacting HMRC.

When HICBC is due

HICBC is paid via Self-Assessment. HMRC has said from 2025/26 onwards, some people can opt to pay HICBC through their PAYE tax code instead — check your Personal Tax Account for the option.

For 2026/27:

  • The charge relates to the April 2026 – April 2027 tax year
  • Register for self-assessment by 5 October 2027
  • File the return and pay by 31 January 2028

Miss the deadlines and HMRC can charge interest and late-filing penalties — even if you’ve had Child Benefit for years without needing a tax return.

Mitigation strategies

Pension contributions — the most effective lever. Every £1 contributed to a pension reduces ANI by £1, directly reducing HICBC (and saving Income Tax + NI if salary sacrifice).

Gift Aid — donations to registered charities count. A £1,000 Gift Aid donation reduces ANI by £1,250 (the grossed-up amount).

Carry-forward pension allowance — if you’ve under-used the £60,000 Annual Allowance in the past 3 years, you can carry forward unused amounts and make a larger single contribution this year.

Salary sacrifice for benefits — electric vehicle schemes, cycle-to-work, childcare vouchers all reduce gross pay and therefore ANI.

Timing bonuses / share vesting — if you can push a big payment into a tax year when your ANI would otherwise be lower, the HICBC impact shrinks.

Common edge cases

  • Separated parents: the partner who lives with the child most of the time claims the Child Benefit, but only the highest earner in that household pays HICBC. A partner outside the household earning £200,000 doesn’t trigger HICBC.
  • Cohabiting couples: same rule — both partners’ income is compared, the highest pays.
  • Income variation year-to-year: ANI is calculated per tax year in isolation. A one-off bonus that pushes you over £80,000 triggers full HICBC just for that year.
  • New parents mid-year: if you qualify for Child Benefit partway through the tax year, the HICBC is pro-rata for the months you actually received it.

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