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Parents Forced to Fill in Self Assessment Tax Return for Child Benefit

Parents Forced to Fill in Self Assessment Tax Return for Child Benefit

PARENTS FORCED TO FILL IN SELF ASSESSMENT TAX RETURN FOR CHILD BENEFIT – Some 10.7 million people in the UK are now subjected to filing in a self assessment annual tax return due to a number of controversial changes to the Child Benefit system.

According to HMRC they have warned that some 100,000 parents are at risk of receiving fines of 100% the amount of child benefit that they have received but no longer entitled to under the new rules.

Therefore parents with just one child could end up with a fine of £263.00 if they fail to complete and return their self assessment tax forms on time.

In order to reduce the welfare bill the Government last year introduced a number of reforms to child benefit which resulted in some 1.1 million parents losing some or all of their child benefit allowance.

Here’s how it works…

  • If one or more parents earn £60,000 or more then no child benefit may be claimed.
  • Those earning more than £50,000 but less than £60,000 lost a proportion of their entitlement which is calculated on a sliding scale.

The self assessment tax return is designed to allow the Government to claw back child benefit payments from those recipients who were not entitled under the new rules.

HMRC stated that approximately 461,000 parents opted out of receiving child benefit in the wake of the new rules and a significant number have registered for self assessment in the hope of retaining their child benefit allowance.

Regardless of the new measures HMRC estimate that some 100,000 parents have yet to register for self assessment which could lead to them being fined.

The deadline for submitting the tax return was on Friday 31 January, this was for the tax period 2012/2013.  HMRC have announced that it will not apply the standard fine of £100 for failing to meet the deadline but they will be hit with a fine for ‘failure to notify’.

Some tax experts have called upon the HMRC to show leniency as this is the first year that many have been required to fill out a self assessment tax return; it is according to some tax experts a confusing system and more help should be provided to allow people to comply.

There can be no question that many feel penalised by the new system but the truth is that unless the Government can significantly reduce welfare across the board over the new few years the rising costs could well bankrupt Britain.

Last year alone the cost of providing welfare, including pensions, resulted in an interest bill of £48.20 billion; yes that’s the amount of interest the Government had to pay on the money it borrowed in order to keep the welfare system afloat.

Last year’s child benefit reform was a step in making people more responsible in that the taxpayer ultimately shouldn’t be responsible for a person’s decision to have children.

We need to move away from the ideology that the Government can take care of us from the cradle to the grave and our dogma of being ‘entitled’.

Yes it’s not something most people, especially those with children, want to hear but the reality is having a child is a lifestyle choice no different to other decisions people make in order to fulfil their desires; such should never become a burden on the taxpayer… in other words if you can’t afford to have children then refrain from doing so.

Time and time again we see the nationalist flag waving from the British public and yet most fail to see or completely understand just how close Britain is to a financial catastrophe and the blame, if it occurs, can be squarely levelled at those who feel somehow entitled to welfare.

Certainly the self assessment system will come as a bit of a shock to some and confusing for many but it is essential that the Government be allowed to slowly wean us off the welfare culture and once again get us to take responsibility for our own lives.

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