A short-term win for GP parents 

Category: HealthcareTaxation - Posted On: Mar 27 2024

Where many GP’s income is above £60,000 and they therefore have not claimed child benefit or stopped payments, it may be time to re-start them. 

The chancellor announced in his budget recently that the threshold will increase to £60,000 for any claw back and the tapering will increase to £80,000. This means that as long as each parent in the household earns less than £80,000 then it is likely worth claiming.  

This is expected to be short lived with a change to the household income system by April 2026.  

When calculating a GP’s income for this purpose includes trading profit plus any employment income less any superannuation payments.   

For example: Dr Ann and her husband Barry have two children, Claire (10) and Dylan (2). Ann is a GP partner and her taxable profit for the March 2023 year was £90,000. Barry is employed as a practice manager and earns £40,000. Ann made superannuation payments in that year of £30,000 gross. Ann also has employment income from teaching at her local university of £5,000. 

Ann’s income for child benefit purposes is £90,000 plus £5,000 less £30,000 = £65,000 and Barry’s is £40,000.  

Under the previous system, if Ann claimed child benefit, it would all be repayable via the high-income child benefit charge as her income was over £60,000.  

Under the new system she would be allowed to claim £170.20 every 4 weeks which is £2,212.60 a year. Ann’s income is £5,000 over the threshold therefore she will have to pay back £553.15 via her tax return but will get to keep the rest.  

Claims can be made here after 6th April and are backdated 3 months: https://www.gov.uk/child-benefit/how-to-claim.

For any additional information get in touch with our healthcare specialists.