As we move into 2025, families across the UK can expect to see an increase in their Child Benefit payments. HMRC has announced new rates for the 2025-2026 period, providing a financial boost to those with children under the age of 16 (or under 20 if they are in approved education or training). Let’s break down the updated Child Benefit rates and what families should consider in the coming year.
New Child Benefit Rates for 2025
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Starting in 2025, the weekly amount families receive for Child Benefit will increase. The new rates are as follows:
- One Child: Families with one child will receive £26.05 per week, up from £25.60 per week. This equates to £1,354 annually, providing a bit more financial relief for families.
- Each Additional Child: For every additional child, families will receive £17.25 per week, up from the previous rate of £16.95. There is no cap on how many children a family can claim for, so larger families will continue to benefit from this support.
These increases come at a time when many families are still navigating financial uncertainties, making the rise in Child Benefit payments a welcome change.
Who is Eligible for Child Benefit?
Child Benefit is available to families who are responsible for children under the age of 16, or under the age of 20 if the child is in approved education or training. This means that the benefit is not limited to younger children only; it also extends to those in further education, providing valuable support as children transition to adulthood.
It’s important to note that only one person can claim Child Benefit for a child. Families with multiple children can continue to claim for each one, but it must be done by a single claimant.
The Income Tax Charge
While Child Benefit is a helpful financial aid, it’s crucial for families to be aware of the Income Tax charge that may apply. If you or your partner’s adjusted net income exceeds certain thresholds, you could be subject to a tax charge on your Child Benefit payments:
- 2024-2025 tax year: The tax charge applies to families where the adjusted net income exceeds £60,000.
- 2012-2024 tax years: The tax charge applied to families with adjusted net income over £50,000.
Adjusted net income includes taxable benefits such as a company car or medical insurance. It’s essential for families to understand how their income is calculated to determine whether the tax charge applies.
Who is Responsible for Paying the Tax Charge?
If your household is liable for the tax charge, the responsibility falls on the partner with the higher adjusted net income. For example, if your partner earns more than £60,000 in the 2024-2025 tax year, they will be the one responsible for paying the tax charge.
This system is designed to ensure that the tax charge is fairly distributed based on income levels, but it’s important for families to assess their financial situation to avoid any surprises.
No Action Needed for Ongoing Claims
Families who already receive Child Benefit will see the increased payment automatically. HMRC has confirmed that there is no need for those with ongoing claims to contact them, as the new rate will be paid directly into their bank accounts.
However, families who need to update their details—such as a change of bank account or address—can easily do so through the official GOV.UK website.
Protecting Your State Pension
An often-overlooked benefit of claiming Child Benefit is its role in protecting your State Pension. For families where one partner is not working or paying National Insurance contributions, making the Child Benefit claim in that partner’s name ensures they receive National Insurance credits. These credits are vital for maintaining or building entitlement to a State Pension in the future.
How and When to Claim Child Benefit
If you’re not already claiming Child Benefit, it’s easy to start. You can apply online through the official GOV.UK website, where you’ll also find information on eligibility and how to update your details if necessary.
Child Benefit is typically paid every four weeks, providing consistent support for families as they navigate their financial responsibilities. Claims can be made for any child under 16, or under 20 if they are in approved education or training.
Final Thoughts
The increase in Child Benefit rates for 2025-2026 is a positive step in supporting families across the UK. The rise in weekly payments will help provide financial stability, and the ability to claim for additional children ensures that the support continues for larger families. However, it’s essential for families to stay aware of the income thresholds and tax charges to avoid any unexpected liabilities. By understanding how Child Benefit works, families can make the most of this support and ensure their financial wellbeing in the coming year.