Adjusted Net Income vs HICBC
This calculator models the High Income Child Benefit Charge (HICBC) and estimates the savings available through pension contributions. It runs three stages in sequence:
Baseline: The individual's gross salary and any bonus are combined into an Adjusted Net Income (ANI). This determines how much Child Benefit is clawed back under the £60,000–£80,000 taper, and whether the Personal Allowance (reduced above £100,000 at £1 for every £2 of income) is affected.
Salary sacrifice: Any workplace salary sacrifice is deducted from gross pay before ANI is calculated, directly reducing the HICBC charge.
Personal SIPP: A net SIPP contribution is grossed up by 20% basic-rate relief (e.g. £4,000 net becomes £5,000 in the pension). This grossed-up amount reduces ANI further. Where ANI falls back below £100,000, any restored Personal Allowance generates a tax saving at 40%. The additional 20% higher-rate relief, claimable via Self Assessment, is shown separately.
Results display the estimated HICBC charge, Child Benefit retained, total pension contributions, and combined tax and benefit savings.
Calculator Assumptions
All statutory thresholds and benefit rates used by this calculator, including the HICBC taper range, Personal Allowance, and Child Benefit weekly rates, are displayed in the Standard Calculator Assumptions panel above the calculator.
In addition, the following methodological assumptions apply:
HICBC taper is calculated in £200 increments per HMRC rules.
SIPP relief: Basic-rate relief (20%) is applied automatically; higher-rate relief (20%) is shown as a separate Self Assessment reclaim.
Salary sacrifice reduces contractual gross pay before tax and HICBC are calculated, consistent with HMRC guidance.
Annual bonus is treated as non-pensionable and is included in ANI.
Calculator Limitations
Estimates only. All figures are illustrative projections, not a formal tax calculation.
Other income not modelled. Rental income, dividends, savings interest, and other sources that may affect ANI are not accounted for.
Self Assessment required. Higher-rate SIPP relief and HICBC liability must be declared via a Self Assessment tax return.
Pausing Child Benefit mid-year stops future payments but does not remove the charge on amounts already received in that tax year.
Annual Allowance not checked. The calculator does not verify whether contributions exceed the Annual Allowance (currently £60,000).
No personal advice. This tool is provided for illustrative purposes only and does not constitute financial, tax, or legal advice. Independent guidance from a qualified financial adviser or HMRC is recommended.
Privacy & Data Security
All calculations are executed locally within your browser. We do not track, store, or monitor the figures you enter into this tool.