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As parents you have probably heard a lot about the Child Benefit changes coming next year
HM Revenue & Customs' Director of Personal Tax, Mary Aiston explains the changes to Child Benefit from January 2013 and where to go for help.
If you are currently responsible for a child you will receive Child Benefit of £20.30 a week for your eldest child and £13.40 a week for each of your other children. However from 7 January, you will have to pay a charge if you, or your partner, are entitled to receive Child Benefit and one of you has an income of more than £50,000. If you and your partner both have income over £50,000 each, the person with the higher income will have to pay the charge.
If you or your partner's income is more than £60,000, the charge is 100% of the amount of Child Benefit. If your income is between £50,000 and £60,000, the charge is gradually increased to 100 per cent of the Child Benefit.
HMRC has written to more than 1 million families affected by the changes, explaining what steps they should take next. But if you know you are affected by the charge and havenít received a letter or have lost it, HMRCís website has all the information you need.
If these changes apply to you or you partner, you will need to decide whether to stop getting Child Benefit and avoid paying the new charge or to keep getting Child Benefit and declare payments for income tax purposes through Self Assessment. If your income is less than £60,000, the tax charge will always be less than the amount of Child Benefit and you could lose money to which you are entitled if you stop getting Child Benefit.
To find out if your income is over £50,000, and examples of how much you are likely to pay, visit HMRCís website.
If you want to stop getting Child Benefit, you should tell HMRC before 7 January 2013. You can still stop the payments after 7 January, but there will be a charge.
If you want to keep receiving Child Benefit, you should register for Self Assessment if you have not already done so.
Go here for more information on Child Benefit Changes
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