Penalties for wealthy who fail to disclose child benefit info

Higher rate taxpayers could face penalties if they fail to declare child benefit received by a partner.

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by Michelle McGagh on Oct 29, 2010 at 08:07

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Penalties for wealthy who fail to disclose child benefit info

Higher rate taxpayers could face penalties if they fail to declare child benefit received by a partner.

According to the BBC, the Treasury has confirmed wealthy people will be fined if they fail to disclose child benefit in their earnings. From 2013 if one parent is earning over £44,000 child benefit will be removed.

The new rules will be a burden on the tax administration which has previously looked at individuals rather than couples.

The government plans to write to four million higher rate taxpayers to ask them whether their household gets child benefit. According to the BBC, those who do not answer or do not tell the truth could be fined.

The move to scrap child benefit for high earners will save the government £2 billion a year although the plans have been criticised for penalising stay-at-home mothers.

A couple who are both working and earn more than £80,000 between them can still claim the benefit but individuals relying on one income above the higher rate of tax will not.

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7 comments so far. Why not have your say?

Some people don't know if they are going to be a higher rate tax pay until the end of the year. This could be because they may get income from unpredictable sources such as overtime and commission. How is the legislation going to deal with these people?

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Make it simple, pay child benifit for two children only, people who have more should be prepared to support them.

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It is a nonsense; there is no legal obligation to declare one's tax status or one's sources of income to a 'partner' so it follows that anyone who receives such a letter from the Gov may ignore it with impunity.

HMRC must know who is receiving child benefit and their tax rate; if Gov feel the need to enquire into the sexual relationships of those receiving 'benefits' then it follows that the 'benefits' policy is deeply flawed

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Surely anyone with a basic grasp of databases can cross match the higher rate tax payers addresses to tthe child benefit database. Obviously this assumes HMRC is still relying on paper based systems.

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Anonymous 2, You would think they could but it just shows how uncoordinated the government IT policy has been. They have basically taken individual systems that were paper based and converted them to use a computer. They are still all disconnected with no means of cross checking.

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Four million letters – there goes a million pounds for postage plus another million on bureaucracy. It would simplify the whole process if child benefit became part of the tax code for those that work and part of the new benefits system for those that don’t.

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Ramsey J

Oct 29, 2010 at 18:18

The coalition govt has promised to make their business easier! This huge can of worms can be avoided if the tax man keeps away from the issue.

Why not stop all child benefits in 2013 and ask people to apply to the appropriate dept with supporting evidence of number of children, income etc? This will ensure benefit goes to people who needs it. There is enough time to prepare a stratightforward procedure. Current intentions will lead to chaos, abuse of the system and a lot of hard feelings.

By the way, I agree with prev poster that benefit should be limited to 2 children.

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