Question to the HM Treasury:

To ask the Chancellor of the Exchequer, if he will make an assessment of the potential merits of basing child benefit eligibility on household rather than individual income.

The High Income Child Benefit Charge (HICBC) is calculated on an individual rather than household basis in line with other tax policy. If the HICBC was based on household income, this could mean finding out the incomes and relationships of all Child Benefit claimants. This could put disproportionate burdens on families, as most claimants are not affected by HICBC and currently do not need to provide this information to HM Revenue and Customs.

Regarding the threshold, the current level enables the Government to support most families while keeping welfare expenditure sustainable. In 2020-21 (the latest year that data is available), 88% of Child Benefit claimants were unaffected by the HICBC. Regarding the impact on families, the HICBC applies as long as one parent’s income is above the threshold. In 2020-21, 99.7% of those who declared a liability for HICBC paid income tax at the higher rate or above.

As with all elements of tax policy, the Government keeps the HICBC under review.