Media Centre

Tuesday 22nd May 2018 - Last update: August 24th, 2017.

Why business owners should still be claiming child benefit

August 15, 2017

Author:

Type: Latest Blogs, Start-ups and Small business Blogs, Tax, Trending

In the UK you can claim child benefit if you have children under the age of sixteen that you are responsible for, sometimes up to the age of twenty if they attend approved educational courses, such as A Levels. The child tax credit is paid monthly to parents, if they claim it. In the past I have come across some higher earning parents that don’t claim the benefit, as they know it will be repaid as a tax charge. However, not claiming child benefit can be a disadvantage both to the parent and the child in the long term.

 

Claiming child benefit whether it is actually paid or not, ensures the parent receives national insurance (NI) credits for periods when they aren’t earning, whilst the child is under twelve.

 

To receive the full state pension, the parent (Or anyone) needs to have paid NI or have received NI credits, for 30 tax years. The NI credits from child benefit help plug the gap in the NI record which may be created when one of the parents stays at home to care for the child. Both parents need to build up a complete NI record, as the new flat-rate state pension is not paid based on a spouse’s NI contributions.

 

The claim also creates a dormant NI record for the child: at the age of fifteen years and nine months, they are allocated an NI number. Where child benefit hasn’t been claimed, the individual will need to apply for an NI number before they can work, open an ISA or receive a student loan etc.

 

To avoid these difficulties, the child benefit should be claimed as soon as possible after the child’s birth. Where the parent expects that the benefit will be clawed-back as a tax charge, they should tick a box on the claim form to receive a nil payment. They can reverse this at any time; however, a benefit claim can only be back-dated for up to three months.

 

If you would like to discuss the above blog in more detail, or you would like to speak with a member of our team, please contact Colin Hughes or call 01253 404404 to be put in contact with a member of our Start-ups and Small Business team.

トピックの詳細

купить аттестат 9 классов

mitsubishi.niko.ua

Did you enjoy this blog?

Click here to sign up to our Newswire to get these sent directly to your inbox!