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HMRC internal manual

Claimant Compliance Manual

Child Benefit and Tax Credits: What Are Child Benefit and Guardian's Allowance

Child Benefit is a tax free benefit paid to persons who are responsible for one or more children or qualifying young person or persons in a week. For Child Benefit purposes a week starts on Monday.

There are two rates of payment. A higher rate is payable for the eldest or only child or qualifying young person in the family and a basic rate for all other children or qualifying young persons, see CCM18017.

Guardian’s Allowance is a benefit paid in addition to Child Benefit to someone who is looking after a child whose parents have died. In some circumstances it can be paid when only one parent has died, see CCM18090. They do not have to be the child’s legal guardian to get Guardians Allowance.

Child Benefit and Guardians Allowance do not depend on income, savings, or payment of NI contributions. The benefits are not taxable and do not count as income for tax credit purposes.

These benefits must be claimed within 3 months of the day of entitlement for example the date of birth or entry into the UK - and may be backdated three months, see CBTM02020 

The information on each claim is checked to decide whether entitlement exists and if it does how much should be paid. Unless a relevant change of circumstances is expected in the near future the award is made for an indefinite period.

Most Child Benefit and Guardian’s Allowance awards are paid directly into a bank, building society or Post Office Card Account. Where awards cannot be paid into an account they can be paid by cash cheque.

Usually, payments are made every 4 weeks, but some people can choose to get paid weekly, see CBTM03040 

Main differences to Child Tax Credit (CTC) is

  • income based
  • based on award periods which are usually for a financial year, however this can be shorter if entitlement changes. See TCTM07001 
  • based on award periods which are calculated on a daily basis, child benefit is calculated on a weekly basis