Martin Lewis issues warning over Child Benefit as single dad slams 'unfair' rule

23 January 2024 , 11:05

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Martin Lewis has urged for a Child Benefit review (Image: ITV)

Martin Lewis has urged Jeremy Hunt to review the “unfair” high income Child Benefit charge which “penalises single-income families”.

The MoneySavingExpert.com said it was “by far the biggest single topic” the public had asked him to raise with the Chancellor, ahead of the Budget on March 6. The high income Child Benefit charge applies when either yourself or your partner start to earn over £50,000.

You pay back 1% of your Child Benefit for every £100 of income between £50,000 and £60,000. Earn over £60,000 and you'll need to pay back 100% of your Child Benefit - meaning you don't get anything.

Campaigners have said this rule is unfair, as it means a couple earning just under £50,000 each - for example, say they earn £49,500 each, so a combined total of £90,000 - won’t have to repay any Child Benefit. But if a single parent earns £60,000, they will have to repay the full amount.

Martin used the example of a single dad whose partner died and is now struggling to pay the bills, but he is forced to repay his Child Benefit because he earns £60,000. The example was shared by his father, Alan, who said: “My son’s partner tragically died 34 days after giving birth to twins.

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“My son has taken a new job that now pays him £60,000 and is struggling with the cost of living and mortgage repayments after the loss of a second income. HMRC has asked him to repay the Child Benefit. This seems grossly unfair that a couple can bring in nearly £100,000 but a single breadwinner loses out once they earn more than half of this.”

In his letter to the Chancellor, Martin added: “I was very pleased that you accepted there is an 'unfairness' in the structure that penalises single-parent families, single-earner families, and families where there is one dominant earner. While I agree, as you pointed out, that there are many structural problems in the tax system, this one is exacerbated by the fact the £50,000 (and £60,000) thresholds have been frozen since 2013 – which fiscally-drags 100,000s more families into this situation each year. I’m sure it would be a very popular measure if it were addressed in the Budget.“

Levi Winchester