What is adjusted net income for the High Income Child Benefit Charge?

Is the salary on my P60 the same as adjusted net income?

No. A P60 is the pay and tax from that employer for the tax year. GOV.UK’s adjusted net income page starts from total taxable income across every source, then takes off listed reliefs. The Child Benefit tax calculator also says adjusted net income includes taxable benefits from a job, such as a company car or medical insurance.

A parent whose P60 is under the High Income Child Benefit Charge threshold can still be over it once savings interest, dividends, a second job or a company car are added. A parent whose P60 is over the threshold can still be under it once Gift Aid and the pension deductions GOV.UK lists are taken off. The charge uses the finished figure, not the payslip headline.

What income counts towards adjusted net income?

GOV.UK’s step 1 says add up taxable income. The list on that page includes the items below. This page does not add extra types of income beyond that list.

How do I work it out on GOV.UK’s four steps?

Copy the official order. Do not skip a relief and do not deduct the same pension twice.

1. 1
   Step 1 — work out net income Add the taxable income GOV.UK lists. Then take off tax reliefs that apply at this stage, such as payments made gross to pension schemes (paid without tax relief) and trading or property losses. That total is your net income.
2. 2
   Step 2 — take off Gift Aid If you made a Gift Aid donation, take off the grossed-up amount: what you paid plus basic-rate tax. GOV.UK’s rule is: for every £1 of Gift Aid donations, take £1.25 off net income.
3. 3
   Step 3 — take off relief-at-source pensions If you paid into a private pension where the provider already gave basic-rate tax relief, take off the grossed-up amount. GOV.UK’s rule is the same shape: for every £1 of that contribution, take £1.25 off net income.
4. 4
   Step 4 — add back union or police organisation relief Tax relief of up to £100 is available for certain payments to a trade union or police organisation. If you took an amount off at step 1 for that type of payment, GOV.UK says add it back.

GOV.UK’s own High Income Child Benefit Charge example on that page: Clara has £65,000 employment income and £5,000 bank interest. She pays £4,750 into a private pension without tax relief, then £1,000 Gift Aid. Her adjusted net income is £64,000. That is the number the charge uses, not the £65,000 salary.

Which reliefs reduce the figure the charge uses?

The reliefs on the official page are a closed list: trading losses, Gift Aid (grossed up), pension contributions paid gross, and relief-at-source pension contributions (grossed up). Salary that never entered taxable pay because of salary sacrifice or a net-pay workplace pension is already lower before you start — you do not deduct that contribution again. See Can pension contributions reduce the High Income Child Benefit Charge?.

GOV.UK also uses adjusted net income for the income-related reduction to the Personal Allowance where the figure is over £100,000. That is a different tax rule. It does not change the High Income Child Benefit Charge thresholds of £60,000 and £80,000 used from 2024–25.

Why does the charge use this number rather than salary?

Because the charge is an Income Tax charge on the higher earner. GOV.UK’s overview says you need adjusted net income to see whether you are over the threshold, and that the figure is total taxable income including savings interest and dividends, calculated before Personal Allowances and less certain tax reliefs such as pension contributions and Gift Aid.

In shortIn short: work adjusted net income from GOV.UK’s four steps. A P60 is one input, not the answer. Put the finished figure into the Child Benefit tax calculator, which still uses the individual higher-earner test for tax years 2024–25 through 2026–27.