Reader Question:
Hello, my partner is about to inherit about £100,000 from his mother's estate. We are planing to keep some for a rainy day but most of the money will go to pay part of our mortgage and pay off about £8,000 on our only credit card. Would this effect us getting Child Benefit? My partner earns just under £45,000 pounds?
My response:
From January 2013 Child benefit is to be gradually withdrawn once one person in a household earns £50,000. The rate of withdrawal is 1% of child benefit for every £100 earned over £50,000, resulting in total withdrawal once earnings of £60,000 have been achieved.
The Child Benefit 'test' only relates to 'adjusted net income' which is any employment income plus income from savings and investments less pension contributions. So as long as this remains below £50,000 for both of you you will still receive your Child Benefit.
For more information read my article Child Benefit changes - how will they be implemented?
I hope that helps
Best Wishes
Damien
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Thank you Damien, this is very helpful and put our minds to rest.