Labour slams child benefit changes

Up to one million families face having their child benefit clawed back through complicated self-assessment tax returns, Labour has warned.

The Treasury has confirmed around 200,000 parents have opted out of claiming the benefit ahead of reforms due to come in on Monday that mean the top 15% of earners will no longer be eligible to claim some or all of the cash.

But around 800,000 families are known to be affected by the reforms, with a further 400,000 potentially hit through changes in income over the next financial year.

Shadow Treasury minister Chris Leslie said: "These figures mean up to a million families now face having all their child benefit clawed back through complicated self-assessment tax returns at the end of the year.

"This is a costly administrative nightmare that could also lead to family rows as couples decide who takes the financial hit. And it's unfair too, because single earner families on £50,000 will have their child benefit cut while some couples earning as much as £100,000 keep all of theirs and millionaires actually get a tax cut.

"With every passing day it's clearer and clearer that David Cameron and George Osborne totally failed to think this policy through."

HM Revenue and Customs chief executive Lin Homer said twice as many families had already opted out of receiving the payment than had been expected, and insisted the changes were going "better than expected".

Households where one parent earns more than £60,000 a year will have to return the entire amount through the self-assessment system unless they have opted out of receiving it in the first place.

The system for recovering the money has proved highly controversial, especially as families where both parents earn just under £50,000 each will keep their payments.

The Treasury said 85% of the population will continue to receive child benefit as they do now while 90% would still receive some of the benefit.