Child Benefit &
HICBC Calculator 2025/26
The High Income Child Benefit Charge creates an effective marginal tax rate that can reach 60%+ between £60,000 and £80,000. This calculator shows exactly how much pension contribution eliminates your charge — and whether it’s ever worth stopping Child Benefit entirely.
Child Benefit rates 2025/26
Child Benefit is paid to the person responsible for a qualifying child (under 16, or under 20 in approved education or training). There is no means test to claim it — but the High Income Child Benefit Charge claws it back through the tax system if the higher earner in a household earns over £60,000.
| Child | Weekly rate | Annual rate |
|---|---|---|
| Eldest or only child | £26.05 | £1,354.60 |
| Each additional child | £17.25 | £897.00 |
| Two children | £43.30 | £2,251.60 |
| Three children | £60.55 | £3,148.60 |
How the HICBC taper works
The charge is based on the Adjusted Net Income (ANI) of the higher-earning partner — not household income. ANI is your total taxable income minus pension contributions and grossed-up Gift Aid donations.
- Below £60,000 ANI: no charge, keep all Child Benefit
- £60,000–£80,000: charge = 1% of Child Benefit received for every £200 of ANI over £60,000
- £80,000+: full Child Benefit is clawed back (charge = 100%)
Note that the taper band is only £20,000 wide. The 1% per £200 rate is equivalent to 0.5% per £100 — deliberately halved in April 2024 from the previous 1% per £100 rate, which doubled the taper from £10,000 to £20,000.
The effective 60%+ marginal tax rate
Between £60,000 and £80,000, you’re in the higher-rate income tax band (40%). Each extra £1 of income also accelerates the HICBC. For a family with two children, the HICBC adds roughly £11.26 per £1,000 of income in this range — creating an effective marginal rate well above the headline 40%.
Annual Child Benefit for two children: £2,251.60. Income of £70,000 is £10,000 over the £60,000 threshold. Taper: (10,000 ÷ 200) × 1% = 50% clawback. HICBC = £2,251.60 × 50% = £1,125.80.
Income tax at 40% on that last £1,000 = £400. But earning £1,000 more also means 5% more HICBC = £112.58 more clawback. Total tax cost of earning £1,000 more: £400 + £112.58 = £512.58 effective marginal rate — over 51%.
For three children, the effect is even larger. At the extreme (one or two children, salary just below £80,000), the combined rate can briefly exceed 60% on specific £1,000 increments.
Using pension contributions to reduce the charge
Personal pension contributions reduce your ANI pound-for-pound. This is the single most powerful tool available. A salary-sacrifice arrangement through your employer is even better — it reduces your gross pay before NI is calculated, so you save employer and employee NI as well as income tax and eliminating the HICBC.
The pension slider above calculates the exact contribution needed to push your ANI below £60,000, and shows your HICBC at every point along the way. Any contribution up to the annual allowance (£60,000 gross, or 100% of earnings if lower) is eligible.
ANI is your gross pay minus pension contributions and grossed-up Gift Aid. If your employer makes pension contributions via salary sacrifice, your P60 gross figure may already reflect the reduction — don’t double-count. Personal contributions paid directly to a pension provider are deducted gross from ANI (HMRC applies basic-rate relief automatically). Workplace contributions through net pay arrangements are also deducted gross.
Should you claim Child Benefit if you’ll pay it all back?
Almost always yes — claim, but elect not to receive payments. The critical reason: the parent who claims Child Benefit receives National Insurance credits until the child turns 12. These credits count towards the State Pension. If you never claim, you potentially forfeit years of NI contribution record — worth thousands of pounds in retirement income.
The clean solution if your ANI is above £80,000: claim Child Benefit, immediately elect to stop receiving payments (via your HMRC personal tax account), and receive the NI credits without any HICBC liability. You can restart payments if your income drops in future years without making a new claim.
Frequently asked questions
Take-home pay, maternity pay, redundancy, universal credit — tools for every life stage.