In current times, with the income of many people having dropped, those eligible for Child Benefit should consider whether to start or restart Child Benefit payments.
Many taxpayers with adjusted net income exceeding £60,000 (or couples where the higher earner has income over £60,000) have chosen to stop payment of Child Benefit rather than suffer a tax charge equal to the benefit.
In the era of COVID-19, it is likely that some of those taxpayers who opted out in the past should now restart Child Benefit because their adjusted net income for 2020/21 will no longer exceed £60,000. This may be the case for some of those that have been furloughed, for example.
Action should be taken as soon as possible as new Child Benefit claims can normally only be backdated for 3 months. The position is less clear when a claim has previously been made but the claimant has chosen not to receive the Child Benefit payments. The HMRC page on restarting payments used to suggest that this could be done up to 2 years after the end of the relevant tax year but the current HMRC page simply states that ‘The Child Benefit Office will write telling you how much backdated Child Benefit you’ll get (if any)’.
Further guidance can be accessed below.