In March 2025, the Chancellor unveiled proposals that shift the burden of administering the High-Income Child Benefit Charge (HICBC). For many households, these changes will simplify the route to compliance, but they also bring new choices and risks. HMRC’s online service for paying the high-income child benefit charge went live in September 2025.

What’s changing in the payment process?

The most important change announced is that employed individuals who are liable for HICBC may be able to have the charge collected via their PAYE tax code, rather than via Self-Assessment.

Up until now, if your adjusted net income pushed you over the threshold, you almost always had to file a Self-Assessment return to settle your HICBC liability, even if your income was otherwise taxed under PAYE.

From September 2025, HMRC is offering an alternative to many such taxpayers: a digital service that allows HICBC to be collected through your PAYE code. As part of this, HMRC also intends to pre-populate Self-Assessment returns with Child Benefit data for those who still need to file them.

This change is a significant development: it alleviates the administrative burden for families who would otherwise need to navigate Self-Assessment solely to repay a benefit charge.

What it means in practice

Because this is optional, you will have to opt in to let HMRC collect via your tax code (unless your circumstances force you to keep Self-Assessment).

If you have other reasons to file a Self-Assessment return (such as investment income or rental income), you may still need to use Self-Assessment, and the new system would be less relevant to you.

One issue to note is that as the transition rolls out, two years' worth of charges may appear in one tax year's PAYE code, depending on the timing. That means your PAYE deduction could be higher in one year, even though it covers multiple years' liability.

Also, not everyone will qualify for PAYE collection under the new system. Some taxpayers will still need to report and pay via Self Assessment.

Why this change matters

Reducing the need for Self-Assessment to pay back the Child Benefit should make life easier for many middle-income families. The pre-population of Self-Assessment forms with Child Benefit data also reduces the risk of errors or missing entries.

However, this reform does not change how the charge is calculated (thresholds, taper, complete withdrawal). And the government has abandoned plans to shift HICBC from an individual income to a household income basis (at least for now), so the "higher earner only bears the charge" approach stays.