From 7 January 2013, any taxpayer with income above £50,000 in a tax year who receives Child Benefit, or whose partner receives Child Benefit, will be liable to incur a new income tax charge.

HMRC have issued a briefing explaining who will be affected, how the charge will work and how it will be administered. Approximately one million taxpayers will be affected by the charge.

A taxpayer will be liable to pay the charge if any of the following apply to them:

• they have an individual income of more than £50,000 in a tax year and receive Child Benefit, or
• they have an individual income of more than £50,000 in a tax year and live or lived with a partner receiving Child Benefit, or
• where partners each have individual incomes of more than £50,000 and one partner is receiving Child Benefit, the partner with the higher income will be liable to pay the charge.

Anyone who has to pay the charge will pay an amount equivalent to some or all of the Child Benefit that they or their partner is entitled to receive. The amount of the charge depends upon the level of their ‘adjusted net income’, and the amount of Child Benefit that the claimant is entitled to receive.

For those with income between £50,000 and £60,000, the tax charge will be less than the Child Benefit entitlement. These individuals will pay 1% of the Child Benefit entitlement for every £100 of their income above £50,000.

For the 2012–13 tax year, the charge only applies from 7 January to 5 April 2013.