Entitlement remains with the claimant

The taxpayer claimed child benefit for the years 2004 to 2020. The claim was in his name rather than the mother’s. In 2012 the couple separated and the taxpayer directed that child benefit payments be sent to the mother’s bank account. The child lives with the ex-wife.

In 2018-19 the taxpayer’s income exceeded the threshold for the high income child benefit charge and HMRC raised assessments to collect the charge. The taxpayer appealed on the basis that he should not be liable to the charge because it is his ex-wife who receives the child benefit. As soon as he realised he may be liable to the charge he cancelled the benefit claim and his ex-wife made a replacement claim. He said the ‘difference was purely of form rather than substance’.

HMRC said the word ‘entitled’ in ITEPA 2003 s 681B should be given the same...