Asked by: Martyn Day (Scottish National Party - Linlithgow and East Falkirk)
Question to the HM Treasury:
To ask the Chancellor of the Exchequer, what assessment he has made of the impact of the High Income Child Benefit Charge on child poverty.
Answered by Victoria Atkins - Secretary of State for Health and Social Care
The threshold for High Income Child Benefit Charge affects taxpayers who are generally on comparatively high incomes. In 2020-21, (the latest year that data is available), 99.7% of those who declared a liability for HICBC paid income tax at the higher rate or above, and 88% of Child Benefit claimants were unaffected by the HICBC.
The Government is committed to supporting families with the pressures they are facing from rising prices. Families who are liable to the HICBC will benefit from the Energy Price Guarantee (EPG), energy bill support scheme and the cancelled planned increase in fuel duty. Moreover, the Government extended the free hours for childcare offers at Spring Budget 2023, so that eligible working parents in England are able to access 30 hours of free childcare per week for 38 weeks per year from when their child is 9 months old, to when they start school.
Asked by: Martyn Day (Scottish National Party - Linlithgow and East Falkirk)
Question to the HM Treasury:
To ask the Chancellor of the Exchequer, when he plans to review the income thresholds for the payment of the High Income Child Benefit Charge.
Answered by Victoria Atkins - Secretary of State for Health and Social Care
The Government publishes annual data on individuals who have declared a High Income Child Benefit Charge (HICBC) liability and individuals that have opted out of getting Child Benefit payments, available on GOV.UK:
Asked by: Martyn Day (Scottish National Party - Linlithgow and East Falkirk)
Question to the HM Treasury:
To ask the Chancellor of the Exchequer, how many people HMRC contacted during tax years (a) 2021-22 and (b) 2022-23 to advise that they may be liable to pay the High Income Child Benefit Charge.
Answered by Victoria Atkins - Secretary of State for Health and Social Care
The High Income Child Benefit Charge (HICBC) is a tax charge which was introduced in 2013 for recipients of Child Benefit payments on higher incomes. The HICBC applies to Child Benefit recipients who have, or whose partner has, an adjusted net income of £50,000.
The Government is grateful to the Office of Tax Simplification (OTS) for their suggestions for how the individual’s experience of child benefit and the High Income Child Benefit Charge (HICBC) could be improved.
HM Revenue and Customs (HMRC) has taken considerable steps to raise awareness of the HICBC. They share information via social media, through third parties such as websites aimed at parents or families, and on GOV.UK. Information about the High Income Child Benefit Charge is on the front page of the Child Benefit claim form and explains how the charge works, including the importance of claiming to ensure receipt of National Insurance credits even if opting out of payments. HMRC also write to around 70,000 customers each year to remind them what they need to do to pay the HICBC.
The latest information on how many people HMRC contact to advise that they may be liable to pay the HICBC is published here: High Income Child Benefit Charge - GOV.UK (www.gov.uk).
Asked by: Martyn Day (Scottish National Party - Linlithgow and East Falkirk)
Question to the HM Treasury:
To ask the Chancellor of the Exchequer, with reference to the Office for Tax Simplification paper entitled High Income Child Benefit Charge, published in March 2022, what steps his Department is taking to improve awareness of the High Income Child Benefit Charge.
Answered by Victoria Atkins - Secretary of State for Health and Social Care
The High Income Child Benefit Charge (HICBC) is a tax charge which was introduced in 2013 for recipients of Child Benefit payments on higher incomes. The HICBC applies to Child Benefit recipients who have, or whose partner has, an adjusted net income of £50,000.
The Government is grateful to the Office of Tax Simplification (OTS) for their suggestions for how the individual’s experience of child benefit and the High Income Child Benefit Charge (HICBC) could be improved.
HM Revenue and Customs (HMRC) has taken considerable steps to raise awareness of the HICBC. They share information via social media, through third parties such as websites aimed at parents or families, and on GOV.UK. Information about the High Income Child Benefit Charge is on the front page of the Child Benefit claim form and explains how the charge works, including the importance of claiming to ensure receipt of National Insurance credits even if opting out of payments. HMRC also write to around 70,000 customers each year to remind them what they need to do to pay the HICBC.
The latest information on how many people HMRC contact to advise that they may be liable to pay the HICBC is published here: High Income Child Benefit Charge - GOV.UK (www.gov.uk).
Asked by: Martyn Day (Scottish National Party - Linlithgow and East Falkirk)
Question to the HM Treasury:
To ask the Chancellor of the Exchequer, how many and what proportion of families are impacted by the High Income Child Benefit Charge.
Answered by Victoria Atkins - Secretary of State for Health and Social Care
In 2020-2021, 88 per cent of Child Benefit claimants were unaffected by High Income Child Benefit Charge (HICBC). Of the remaining 12 per cent, 355,000 paid (or had a partner who paid) the tax charge, and 624,000 chose to opt out of receiving Child Benefit payments as an alternative to paying the charge. Please see the Child Benefit Statistics available on the GOV.UK website here: Child Benefit Statistics: annual release, data at August 2022 - GOV.UK (www.gov.uk)
High Income Child Benefit Charge - GOV.UK (www.gov.uk)
Asked by: Martyn Day (Scottish National Party - Linlithgow and East Falkirk)
Question to the HM Treasury:
To ask the Chancellor of the Exchequer, what assessment he has made of the potential merits of allowing a person to transfer a proportion of the £50,000 earnings threshold to their partner whose individual income exceeds the threshold for the High Income Child Benefit Charge.
Answered by John Glen - Paymaster General and Minister for the Cabinet Office
The High Income Child Benefit Charge (HICBC) is a tax charge which was introduced in 2013 for recipients of Child Benefit payments on higher incomes. The HICBC applies to Child Benefit recipients who have, or whose partner has, an adjusted net income of £50,000.
The UK has a system of independent taxation where every individual, including each partner in a couple, is treated equally within the income tax system and has their own personal allowance and set of rate bands which they can set against their own income. It is a fundamental principle of independent taxation that the individual incomes are taxed separately, and this ensures independence and privacy in their tax affairs. Allowing transfers of income between partners would run counter to this principle.
Asked by: Martyn Day (Scottish National Party - Linlithgow and East Falkirk)
Question to the HM Treasury:
To ask the Chancellor of the Exchequer, whether he has had discussions with the Scottish Government on VAT on deposits in relation to the forthcoming Deposit Return Scheme in Scotland.
Answered by Victoria Atkins - Secretary of State for Health and Social Care
The UK Government supports the drinks deposit return schemes (DRS) being introduced across the UK and their environmental aims. The Government is continuing to work with stakeholders to ensure that the schemes operate effectively.
HM Treasury Ministers regularly engage with their Scottish Government counterparts on a range of issues, including DRS.
Asked by: Martyn Day (Scottish National Party - Linlithgow and East Falkirk)
Question to the HM Treasury:
To ask the Chancellor of the Exchequer, what assessment he has made of the accuracy of the Advisory Electric Rate for fully electric company cars in relation to the rising cost of electricity.
Answered by James Cartlidge - Minister of State (Ministry of Defence)
The Government introduced the Advisory Electric Rate (AER) in 2018. It applies to employees who use a fully electric vehicle as a company car.
The Advisory Electric Rate (AER) was changed in December 2021 from 4 pence per mile (ppm) to 5ppm. This was calculated using published consumption rates, adjusted to reflect real driving conditions, and the average cost of electricity.
However, employers are not required to use the AER. Instead, they can use different rates to reflect their employees’ circumstances. Provided they can show that the bespoke rates do not result in a profit for the employee, there will be no tax to pay. Otherwise, when employers reimburse employees at a higher rate than the published AER (5ppm), the excess is subject to Income Tax and NICs.
The Government keeps this policy under review.
Asked by: Martyn Day (Scottish National Party - Linlithgow and East Falkirk)
Question to the HM Treasury:
To ask the Chancellor of the Exchequer, what recent assessment he has made of the potential merits of increasing the personal allowance for income tax in the context of the rising cost of living.
Answered by Richard Fuller
The Government has increased the Income Tax Personal Allowance (PA) by over 40 per cent in real terms since 2010. The PA’s current level, of £12,570 in 2022-23, is £3,805 higher than it would have been if it had been uprated by inflation every year since 2010-11. The PA is high by international standards and is one of the most generous personal tax allowances in the OECD.
However, the Government keeps all taxes under review.
On cost of living support, the Government has taken immediate action to help households through the Energy Price Guarantee and the Energy Bills Support Scheme. This is in addition to the £37 billion of targeted support for the cost of living this financial year.
Asked by: Martyn Day (Scottish National Party - Linlithgow and East Falkirk)
Question to the HM Treasury:
To ask the Chancellor of the Exchequer, what estimate he has made of the average amount of time it took for a complaint related to Tax Credits Ltd being submitted to HMRC to receive a resolution.
Answered by Richard Fuller
HMRC is unable to comment on named individuals, companies, or organisations.