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Posts Tagged ‘Chartered Tax Adviser’

Child benefit tax charge.

Child benefit tax charge.

From 7 January 2013 child benefit will still be paid to parents who currently receive it, or who make new claims. However, where one or both of the parenting couple has net income over £50,000 a tax charge will apply equivalent to 1% of the child benefit received by the family. This will result in a tax charge equal to 100% of the child benefit when net income reaches £60,000 per year.

‘Net income’ for this purpose is income after the deduction of losses, pension contributions and gift aid payments, but before personal allowances, so there is some scope for reducing the taxpayer’s net income below the £50,000. The child benefit included in the calculation will be that paid from 7 January 2013 onwards.

The tax charge will apply to the taxpayer with the highest net income of the couple in 2012/13, regardless which of the couple claims the child benefit payments. The parenting couple for this purpose do not have to be married, they only have to be living together as though they were married or in a civil partnership, which is a definition taken from benefit law. So one person could be taxed on income received by another person. It is proposed that the child benefit tax charge will be collected through PAYE or self-assessment.

Later in 2012 HMRC will write to every taxpayer with income of £50,000 or more, irrespective of whether they have children or not, to explain the new rules. The child benefit claimant will be given the option of declining to receive child benefit if they or their partner do not wish to pay the tax charge.

For further information contact our Chartered Tax Advisor on +44 (0)1844 260111.

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Penny Bowen

Penny Bowen (was Jones) of DBS is now a Chartered Tax Adviser after passing the highest level tax qualification in the UK.

bowen Penny BowenPenny qualified for membership in July 2011, and becoming a member of the Chartered Institute of Taxation (CIOT), the leading professional body in the UK concerned solely with taxation.

Already a Fellow Chartered Certified Accountant, originally a university Tax and Accounts Lecturer, Penny joined DBS in 2006 and now has over five years’ experience working exclusively for dentists. After taking a family break she returned to studying, first with the Association of Taxation Technicians (ATT) achieving their highest mark in May 2009’s Business Tax paper.

She then threw herself straight into the CTA qualification, relishing being at the forefront when it comes to changes in UK tax legislation to her clients’ benefit.

Penny assists and advises all dental professionals throughout every stage of their careers. This involves managing their tax liabilities through services such as tax savings on building works, practice acquisition or disposal and incorporation. In addition to this, Penny specialises in dealing with the NHS superannuation scheme. Penny is now planning a break from exams, plus ‘my children have threatened to leave home if I take any more’, she says.

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