Keep your child benefit: beating the £60k–£80k charge

Child benefit in 2026/27 pays £27.05 a week for your first child and £17.90 for each other child — £2,337.40 a year for a family of two. The High Income Child Benefit Charge (HICBC) takes it back once the household’s higher earner passes £60,000 of adjusted net income: 1% of the benefit for every £200 over the line, so it’s fully gone at £80,000.

What the taper does to your marginal rate

Spread over the £20,000 taper window, the clawback behaves like an extra tax on the higher earner. For two children it adds about 11.7 percentage points; for one child about 7. Stacked on 40% higher-rate tax and 2% NI, a parent of two earning £60k–£80k faces a real marginal rate around 54% — before any student loan. In Scotland, where this window is taxed at 42%, it’s around 56%. This zone is the first of the traps; the 60% taper and the childcare cliff follow at £100k.

Who’s tested — and the marriage-neutral trap

Only the higher earner’s income matters — the charge doesn’t care about household totals. Two parents on £59,000 each (£118,000 household) keep every penny; one parent on £81,000 with a non-earning partner (£81,000 household) loses it all. Unfair, much criticised, still the law.

Practical consequences:

If your partner earns more than you, your pension contributions can’t fix the charge — the fix has to come from theirs.
If you’re the higher earner by a small margin, a modest contribution can swap who’s tested.

Keep claiming even if you’ll be charged

If the charge would wipe the benefit entirely, you can opt out of payments — but still fill in the claim form. The claim protects the lower earner’s National Insurance credits towards the state pension and gets the child a National Insurance number automatically at 16. Opting out of claiming altogether is a common and expensive mistake.

The fix: bring the higher earner under £60,000

Adjusted net income falls £1 for £1 with gross pension contributions of any type. A parent of two on £70,000:

is losing half the benefit — £1,168.70 a year — to the charge;
can contribute £10,000 (salary sacrifice, net pay or SIPP) to clear it entirely;
gets 40%+ relief on the contribution while restoring the full £2,337.40.

Each £1 of pension in this zone typically costs well under 50p of take-home. The calculator below is preloaded with that scenario — set your own salary, children and your partner’s income to see the charge you’re actually paying and the contribution that ends it.

Try your own numbers

About you

Where you liveSets tax bands and childcare rulesGross salaryAnnual pay before tax or any deductions — the headline figure on your contract, not what lands in your bankTaxable benefits in kindP11D value: company car, private medical… Counts towards the £100k tests. 0 if noneVariable bonus (maximum)The most you might get this year if targets are hit. 0 if nonePension contributionGross annual amount landing in the pensionHow it's paidAlso saves NI and student loan — the cheapest routeStudent loanPostgraduate loan

Your household

Partner with incomeChildrenAnnual childcare spendWith registered providersValue of 30 free hoursWhat you'd pay without them

Which student loan plan am I on?

It depends on where you lived when you took the loan out, and when your course started:

Northern Ireland — always Plan 1, whatever the year.
Scotland — always Plan 4 (loans applied for through SAAS).
England — Plan 1 before Sept 2012, Plan 2 from 2012 to July 2023, Plan 5 from Aug 2023.
Wales — Plan 1 before Sept 2012, Plan 2 after (Wales doesn't use Plan 5).
Postgraduate loan — English or Welsh master's/doctoral loans only; it repays alongside your main plan. Scottish and NI postgrad loans repay through Plan 4 / Plan 1 instead.

Still unsure? Your repayment plan is shown when you sign in to your student loan account on gov.uk.

The fix

Sacrifice £10,000 into your pension

Clear the child benefit charge entirely (£60k). Each £1 landing in your pension costs you just 46p of today's money — about £483 a month less take-home for £833 a month into your pension.

Kept value = take-home pay + child benefit kept + childcare support with no pension contribution, for your household in England, 2026/27 tax year. Contributing moves you left; salary sacrifice lands exactly on the curve, net-pay and relief-at-source land slightly off it (NI and student loans don't fall).

Per year	No pension
Take-home pay	£51,157
≈ per month	£4,263
Income tax	£15,432 £1,286/mo
Employee NI	£3,411 £284/mo
Child benefit kept	£1,169
Childcare support	£0
Total kept value	£52,326

More guides

The 60% tax trap: why £100k–£125k is the worst place to earn

Between £100,000 and £125,140 the personal allowance taper pushes your real marginal rate to 62% — or 69.5% in Scotland. Here's the mechanics and the fix.

The £100k childcare cliff: how £1 of pay can cost you £8,000

Earn £100,001 and you lose free childcare hours and Tax-Free Childcare in full — a hard cliff, not a taper. What it costs a parent of two and the exact fix.

Bonus sacrifice: turn a 62%-taxed bonus into pension at full value

A bonus that lands in the £100k–£125k zone keeps you 38p in the pound — or less with children. Exchanging it into your pension before payday keeps 100p.

Student loans and the tax traps: the 51%–71% graduate rates

Plan 1, 2, 4, 5 and postgraduate loans add 6–15% to your marginal rate — and they stack with the child benefit charge and the 60% taper. The 2026/27 thresholds and what actually reduces them.

Scotland's £100k trap: 69.5% marginal tax, but no childcare cliff

Scottish taxpayers face a harsher personal allowance taper — 67.5% plus NI — but Scotland's universal funded hours mean the £100k childcare cliff is much shallower. The 2026/27 bands and what changes.

2026/27 tax year, childcare with registered providers. Your nation sets the income tax bands (Scotland's six-band schedule vs rUK) and the childcare rules: England and Wales lose free hours over £100k, Scotland's funded hours are universal, Northern Ireland has Tax-Free Childcare only. Child benefit is charged on the household's higher earner, and childcare support needs both parents under £100k. This is a modelling tool, not financial advice — check your own position with HMRC or an adviser.