Families braced for child benefit changes

child benefit changes families braced for

child benefit changes families braced forWelfare benefit has been a staple part of most families' weekly budget for years, but now households across the UK are preparing for child benefit changes that could force us to rearrange the way we use our money.

After announcing sweeping changes to the way almost all financial support, including child benefit, is allocated in the Budget, it appears that Government proposals could be arriving far sooner than people expected, with some families having to adapt to the changes within the next 12 months.

Universal Credit to arrive early

As the recession continues to bite and living costs keep on rising, we are all finding it that bit more difficult to make our family budget stretch a far as it possibly can.

For years the child benefit allowance, of £20.40 for the first child and then £13.40 for each after that, has been a helping hand for parents everywhere in bringing up their young ones.

However, the system as it stands is set to change and while those most in need of the extra cash will not be affected too much, millions of other families will need to adjust the way they account for Government support.

Child benefit is not the only thing that are set to change. Jobseeker's Allowance, income support and housing benefits are all due to be re-jigged as part of the new Universal Credit Scheme.

The new digital system - which will be rolled out initially in certain north western English towns including Wigan and Oldham next April - will take each individual's work and family status into account in a way the Government promises will make the system fairer, and will encourage more people to get out and work.

It will then be rolled out from October next year, initially on a small scale in each region but with new claims for the existing benefits entirely phased out by April 2014.

Child benefit changes

From the moment your area adopts the new system, your child benefit allowance will depend on how much your household earns.

If you or your partner brings in less than £50,000, then you have nothing to worry about. The amount of child benefit you receive will stay the same, and so will how often you can claim it.

But if you or your partner earn more than £50K, then things are a little more complicated. Depending on how far above the 50 grand cut-off you are, you will have to pay back some of the child benefit you are given each year, until your salary hits £60,000 when you have to pay back all of it.

As you can see in this breakdown of how child benefit works, a little organisation goes a long way to ensuring you are still making the most of your full entitlement.