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Posted Tue, 18 Jan 2022 22:09:37 GMT by Gareth
Hi. In calculating my taxable income for the purpose of checking if a high income child benefit charge is due for the 20-21 tax year, I'm unclear if the dividends and capital gains I received should be included. I received £2000 in dividend payment, therefor did not exceed the dividend allowance. I received £12,300 capital distribution, therefore did not exceed the GCT allowance. Aside from these items I received £49,800 gross pay from all employments. So just below the £50000 threshold for the high income child benefit charge. Many thanks
Posted Wed, 19 Jan 2022 15:29:14 GMT by HMRC Admin 17

Please see guidance here on what is included for your net income for child benefit purposes:

High Income Child Benefit Tax Charge .

Dividends would be included, but not capital gains.

Thank you.
Posted Wed, 19 Jan 2022 16:16:05 GMT by Gareth
Thank you for the response, I appreciate it. The confusion I have regarding the guidance you kindly provide a link to is that under the definition of taxable income, it specifically states that dividends which fall under the dividend allowance are not subject to income tax. Therefore please reconfirm, does the £2000 of dividends I received need to be added to the calculations for the child benefit high income charge, as I believe it does not based on that guidance. Thanks again
Posted Thu, 20 Jan 2022 12:24:02 GMT by HMRC Admin 10

The first link advises what will be taxable income and how it is taxed.

If you use the link for the child benefit charge calculator it will show that you will include the dividend before tax, so it is irrespective of whether it is charged to tax or not. 



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