The Child Benefit tax trap between £60,000 and £80,000

How it works

Child Benefit isn't means-tested — everyone who claims it gets it, whatever they earn. The charge is separate: HMRC claws it back through the tax system once the higher-earning partner's adjusted net income — roughly speaking, taxable pay after any pension contributions come off — passes £60,000. It rises by 1% of the year's Child Benefit for every £200 above that, reaching 100% at £80,000: a £20,000-wide band in which the whole thing disappears.

It doesn't matter which partner actually claims the Child Benefit — the charge falls on whichever of you earns more, even if that isn't who the payments go to.

Worked example

A couple with two children, one partner on a salary with no pension contributions, in 2026/27:

The £10,000 rise from £60,000 to £70,000 adds £4,000 of Income Tax, £200 of National Insurance and £1,169 of Child Benefit charge — so take-home only goes up by £4,632 of that £10,000, an effective marginal rate of about 54%, well above the 42% the tax bands alone would suggest.

Try it with your own numbers in the PAYE calculator →

Getting it back with pension contributions

Pension contributions reduce adjusted net income, so — just like the Personal Allowance taper above £100,000 — they bring the charge down too. Take the £70,000 example above and sacrifice £10,000 into a pension: adjusted net income drops back to £60,000, the charge disappears, and you keep all £2,337 of Child Benefit.

That costs £4,632 of take-home pay to put £10,000 into the pension — in effect, about 54% relief once the Income Tax, National Insurance and Child Benefit saved are all counted, not just the Income Tax relief a pension gets on its own. Through an auto-enrolment (net pay) scheme it costs £200 more, because salary sacrifice also saves the 2% National Insurance and net pay doesn't.

See the £70,000 example with salary sacrifice →

How it scales with more children

The charge is a share of your actual Child Benefit, which depends on how many children you have — £27.05 a week for the eldest and £17.90 for each other child in 2026/27, so £2,337 a year for two children and £3,268 for three. The Income Tax and National Insurance in the £60,000–£80,000 band are the same whatever your family size; it's only the Child Benefit being clawed back that changes. With three children, each extra £100 earned in the band leaves you about £42 rather than £46 — a marginal rate of roughly 58% rather than 54%. A family with four or more children loses proportionally more again.

Other things to know

You don't have to give up Child Benefit to avoid the charge. You can opt out of receiving the payments while staying registered as a claimant. That still gets you National Insurance credits towards your State Pension for whichever parent isn't earning enough to build them up another way, and a National Insurance number issued to your child automatically — both worth keeping even if you'd rather not deal with paying the charge back each year.

It's the whole year that counts. Like the Personal Allowance taper, the charge is worked out on income for the tax year, not month by month, so a bonus or a pay rise part-way through the year can push you into it even if your salary alone wouldn't.

Earning near £100,000 too? The Personal Allowance taper piles a similar cost on top from £100,000 — see the 60% tax trap, explained.