What are child benefits, am I entitled to and how much will I receive?
Wondering what family allowances are? At a time when bills are rising everywhere and average care costs (opens in a new tab) are also increasing, it has never been more careful for families to understand the benefits to which they are entitled. Child allowance can help give your family budget a much-needed boost. You can also see if you are eligible for 30 hours of free care (opens in a new tab) or the tax-free childcare allowance (opens in a new tab).
It’s not paid automatically so you have to claim it and if you don’t you could miss out on at least £1,133 a year, and more if you have more than one child.
Kalpana Fitzpatrick, editor of our sister brand The Money Edit (opens in a new tab)says: “Family finances are under extreme pressure with the rising cost of living, so it’s imperative that you apply for any benefits you may be entitled to to ease the pressure.”
What are family allowances?
Child benefit is a government payment to help families meet the cost of raising children. It was first introduced in 1977 and replaced the old child benefit system. Anyone responsible for raising children can claim it. It’s not means-tested, so you don’t have to prove how much you earn to qualify.
Payments are made at fixed rates – so everyone gets the same rate regardless of their financial situation. You can apply for Child Benefit regardless of how much you have saved – which is not the case with some other benefits.
How do family allowances work?
With Child Benefit you can claim a regular weekly payment for each child in your household – and there is no limit to the maximum number of children you can claim for. Payments are made when the children are under 16, or 20 if they are in ‘approved’ full-time education or training.
Only one person can apply for child benefit for each child, so it is worth thinking carefully about which parent gets the money depending on Sarah Coles (opens in a new tab)personal finance analyst at Hargreaves Lansdown.
“If one of you does not work or earn enough to pay national insurance (opens in a new tab), (NI), they must be registered for family allowances. Indeed, they can receive national insurance credits, which count towards their right to a state pension. If a parent who earns enough to pay AI gets the money, they won’t get the credit.
Once you have applied for Child Benefit, payments will be made directly to your bank or home savings account every four weeks.
How much are family allowances?
Family allowances are paid at two different rates. For your first child you will receive £21.80 per week. For all subsequent children you will receive £14.45 per week.
Money will be paid directly to your bank, building society account or credit union account every four weeks – usually on a Monday or Tuesday.
|Who is the grant for?||Price (weekly)|
|Elder or only child||£21.80|
|Additional children||£14.45 per child|
Source – HM Revenue & Customs (opens in a new tab)
In some cases, you can request that your payments be made on a weekly basis, for example, if you are a single parent or if you are applying for certain benefits, including income support.
If you want to change the way your payments are made or have them paid to a different account, you should contact the Child Benefits Helpline on 0300 200 3100.
Am I entitled to family allowances?
You can claim family allowances if you are responsible for one or more children.
Family allowance is a universal allowance available to anyone responsible for raising children. Even if you think you don’t need the money, or are worried about the high-income child benefit burden, it’s still important to apply. Learn more https://t.co/zAiklXbBis pic.twitter.com/ebszvF0CqgJune 22, 2022
However, once you or your partner are earning more than £50,000 a year, while you may still be receiving child benefit, you will be liable for a High Income Child Benefit Tax (opens in a new tab).
Sarah Coles, personal finance expert, says: “Since January 2013, if either parent earns more than £50,000, part of the child benefit must be repaid.
“You repay 1% of your benefit for every additional £100 you earn over the threshold, until any family where one parent earns £60,000 or more has to repay it all. Those repaying part of their Child Benefit will apply and then complete a self-assessment tax return to repay part of it.”
“If both couples are working and paying National Insurance, and one is earning over £60,000, they can choose not to apply for Child Benefit at all. If your situation changes, you can change your arrangements by contacting HMRC”.
You can use this family allowance tax calculator (opens in a new tab) to see how much tax you pay based on your income.
How to apply for child benefit – step by step guide
You can apply for family allowances as soon as you have registered the birth of your child or the child for whom you are responsible comes to live with you. Applications can be backdated by up to three months, but new child benefit applications can take up to 16 weeks to process, so it’s worth applying as soon as possible.
To get started, you need to download and complete a family allowance application form (opens in a new tab) (CH2). It may sound daunting, but the information needed is basically your personal data such as your name, address, date of birth and national insurance number, as well as your partner’s contact details, if relevant.
You must also complete the details of the child or children you are claiming for and how you want your Child Benefit paid.
Once the form is completed, return it to the address listed on the form with all the documents requested – usually your child’s birth or adoption certificate.
These must be originals – not photocopies – and must be returned to you within four weeks.
If at a later date you want to add another child to your application, for example after having another baby, you can call the child benefit helpline directly on 0300 200 3100.
You will need your national insurance number and the child’s birth certificate to add to your existing Child Benefit application.
What happens to your family allowances if your family separates?
If you and your partner separate, it is usually the person with whom the child lives most of the time who will apply for child benefit.
However, if you separate and have two children and decide that under your new living arrangements one of your children will live with you and the other with your ex-partner, you can all both apply for child benefit.
In this case you will both be able to claim the higher rate of £21.80 per week for your first child, but if you have more than one child you can only claim £14.45 for each of the other children.
If you are moving in with a new partner who also has children, the oldest child will be entitled to the higher rate of £21.80, and all other children will be entitled to the lower weekly rate of £14.45.
When do family allowances stop?
Payments will stop on August 31, on or after your child’s 16th birthday, or when your child leaves school or training before their 20th birthday.
Sarah Coles of Hargreaves Lansdown explains what counts as continuing education or training: “This includes things like A-levels, T-levels and NVQs up to level 3. If they’re still learning, you’ll continue to receive it, until the end of February, May, August or November after leaving approved education. However, you must tell the child benefit office that they are continuing their studies, otherwise it will stop”.
You must also notify the family allowance fund of any change in your child’s situation (opens in a new tab) as this may affect whether or not payments stop, even temporarily. Changes include if your child starts paid work for more than 24 hours a week, lives away from you for more than eight consecutive weeks, or goes abroad for more than 12 weeks.
You can report any changes to your or your child’s situation online or by calling the child benefit helpline on 0300 200 3100.
What other benefits can you claim in addition to family allowances?
You can still claim other benefits while applying for child benefit. Any other benefits or payments you are entitled to will depend on your financial and living situation. If you are not working or have a low income, it is worth using a benefits calculator (opens in a new tab) to see what you might be entitled to.
If you apply for family allowances, you can benefit from National insurance credits (opens in a new tab). This applies if your child is under 12 and you are not working or earning enough to pay national insurance.
These credits count towards your state pension so you don’t miss out on your state pension level later in life by taking time off to raise your children.