Child benefit
Encyclopedia
Child benefit is a social security
payment disbursed to the parents or guardians of child
ren. Child benefit is means-tested in some countries.
On 1 July 2000 the Australian government introduced major changes to the tax system including the introduction of a broad-based Goods and Service Tax (a VAT), substantial income tax cuts, as well as major changes to assistance for families.
These changes to family assistance simplified payments, by amalgamating a number of different forms of assistance, and also provided higher levels of assistance, with reductions in income test withdrawal rates. The new structure combined twelve of the pre-existing types of assistance into three new programs of assistance. The two most important of these are Family Tax Benefit Part A, which assists with the general costs of raising children, and Family Tax Benefit Part B, which is directed to single income and sole parent families. The third programme is Child Care Benefit.
The Family Tax Benefit Part A is paid for dependent children up to 20 years of age, and for dependent full-time students up to the age of 24 (who are not getting Youth Allowance or similar payments such as ABSTUDY and Veterans' Children Education Supplement). It is essentially a two-tier but integrated payment directed to most families with children, with a higher rate for lower income families, including both those in work and receiving income support.
The maximum rate is paid up to a family income of $28,200, and is then reduced by 30 cents for every extra dollar of income, until the minimum rate is reached. Part-payment at the minimum rate is available up to a family income of $73,000 (plus an additional $3,000 for each dependent child after the first). Payments are then reduced by 30 cents in every dollar over that amount until the payment reaches nil.
To receive some Family Tax Benefit Part A, the maximum income levels are $76,256 a year for a family with one dependent child under 18 and $77,355 a year for a family with one dependent 18- to 24-year-old. These thresholds are lifted by $6,257 for each additional dependent child under 18 and $7,356 for each additional dependent 18- to 24-year-old.
Families receiving Family Tax Benefit Part A may also be eligible for extra payments, such as Rent Assistance if renting privately, the Large Family Supplement for four or more children, and Multiple Birth Allowance for three or more children born during the same birth.
Family Tax Benefit Part B provides extra assistance to single income families including sole parents - particularly families with children under 5 years of age. In a couple, if the secondary earner's income is above $1,616 a year, payments are reduced by 30 cents for every extra dollar of income. Parents receive therefore some Family Tax Benefit Part B if the secondary earner's income is below $10,416 a year if the youngest child is under 5 years of age, or $7,786 a year if the youngest child is between 5 and 18 years of age. There is no income test on the primary earner’s income, so in the case of sole parents the payment is universal.
The previous entry referred to Youth allowance and Parenting Payment. These are income support payments for young people and for parents who are not employed and looking after children respectively.
Multiple births are a special case. In the event of twins, 150% of the monthly payment is paid for each child. Triplets, or more, are paid the double (200%) rate each; provided that all of them remain qualified (i.e. stay in further education until 19). In addition, a special 'once-off' grant of €635 is paid on all multiple births. Further 'once-off' grants of €635 are paid when the children are 4 and 12 years old respectively.
Fraudulent claims of Child Benefit are treated very seriously, and can result in 3 years imprisonment or fines of up to €12,697.38.
Today, the guardians of all children aged 16 or younger, are awarded child benefits of 1050 crowns per month.
The couple Alva and Gunnar Myrdal have played a very influential role in the Swedish society. (Alva got Nobel’s Peace prize in 1982 and Gunnar got Nobel’s prize in economics in 1974). You can find more information here: http://sv.wikipedia.org/wiki/Kris_i_befolkningsfr%C3%A5gan
Their book “Kris i befolkningsfrågan” (Crisis in the Population Development”) was published in 1934. It painted a very dark picture of Sweden. The growth of the population would turn negative and Sweden be filled with mostly elderly people.
This book had an important influence and in 1937 child allowance was introduced for poor mothers.
In 1948 child allowance was extended to all families and was then SEK 260 per year or SEK 22 per child and month. The price of milk was then SEK 0.30 per litre so the value of the monthly allowance was 72 litres per milk and year. – Quite a significant contribution. (For my Swedish friends, the price of 1 kg of falukorv was 3 kr)
Using the consumer price index, in 2010 the value would have been SEK 383 per month and child. Today the child allowance is roughly SEK 2000 per month and child.
In 2001 the child allowance increases as the number of children increases. This does of course create an important incentive for people with children to migrate to Sweden.
The number of children borne per mother has decreased as well as the death rates in Sweden as can be seen from the figure below.
Regarding the 1948 decision one woman was interviewed by the Swedish Radio, Mrs. Persson. She had 13 children and one had died. The journalist asked her what she would do with the money. Three of her children went to school and they needed clothes. Perhaps she would save some of the child allowance in case the children would study further. She would not use the money on luxury such as bicycles. She did not plan to spend any money on herself.
One of the heads of the child allowance system was born in 1948 and he believes that there was very little corruption in the system.
, child benefit is administered by Revenue and Customs
Child Benefit Office in Washington, Tyne and Wear. As of April 2010, £20.30 per week is paid for the first child (including the eldest of a multiple birth) and £13.40 per week is paid for each additional child. The same amount is currently paid without reference to earnings or savings, although higher-rate taxpayers will not receive this benefit from 2013. More than 80% of children are in families also eligible for means-tested child tax credit
.
The system was first implemented in August 1946 as "family allowances" under the Family Allowances Act 1945
, at a rate of 5s
per week per child in a family, except for the eldest. This was raised from September 1952, by the Family Allowances and National Insurance Act 1952, to 8s, and from October 1956, by the Family Allowances Act and National Insurance Act 1956, to 8s for the second child with 10s for the third and subsequent children. By 1955, some 5,000,000 allowances were being paid, to about 3,250,000 families.
It was modified in 1977, with the payments being termed "child benefit" and given for the eldest child as well as the younger ones; by 1979 it was worth £4 per child per week. In 1991, the system was further altered, with a higher payment now given for the first child than for their younger siblings. In October 2010, the Conservative-Liberal coalition government announced that Child Benefit would be withdrawn from households containing a higher-rate taxpayer from January 2013.
Social security
Social security is primarily a social insurance program providing social protection or protection against socially recognized conditions, including poverty, old age, disability, unemployment and others. Social security may refer to:...
payment disbursed to the parents or guardians of child
Child
Biologically, a child is generally a human between the stages of birth and puberty. Some vernacular definitions of a child include the fetus, as being an unborn child. The legal definition of "child" generally refers to a minor, otherwise known as a person younger than the age of majority...
ren. Child benefit is means-tested in some countries.
Australia
In Australia, Child benefit payments are currently called Family Tax Benefit. Family Tax Benefit is income tested and is linked to the Australian Income tax system. It can be claimed as fortnighly payments or as an annual lump sum. It may be payable for dependant children from birth up to the age of 24. Children 16 years or older may alternatively be eligible for Youth Allowance. Parents of dependant children under the age of 16 may also be eligible for Income Support Payments including Parenting Payment and Newstart Allowance for Primary Carers of Children.On 1 July 2000 the Australian government introduced major changes to the tax system including the introduction of a broad-based Goods and Service Tax (a VAT), substantial income tax cuts, as well as major changes to assistance for families.
These changes to family assistance simplified payments, by amalgamating a number of different forms of assistance, and also provided higher levels of assistance, with reductions in income test withdrawal rates. The new structure combined twelve of the pre-existing types of assistance into three new programs of assistance. The two most important of these are Family Tax Benefit Part A, which assists with the general costs of raising children, and Family Tax Benefit Part B, which is directed to single income and sole parent families. The third programme is Child Care Benefit.
The Family Tax Benefit Part A is paid for dependent children up to 20 years of age, and for dependent full-time students up to the age of 24 (who are not getting Youth Allowance or similar payments such as ABSTUDY and Veterans' Children Education Supplement). It is essentially a two-tier but integrated payment directed to most families with children, with a higher rate for lower income families, including both those in work and receiving income support.
The maximum rate is paid up to a family income of $28,200, and is then reduced by 30 cents for every extra dollar of income, until the minimum rate is reached. Part-payment at the minimum rate is available up to a family income of $73,000 (plus an additional $3,000 for each dependent child after the first). Payments are then reduced by 30 cents in every dollar over that amount until the payment reaches nil.
To receive some Family Tax Benefit Part A, the maximum income levels are $76,256 a year for a family with one dependent child under 18 and $77,355 a year for a family with one dependent 18- to 24-year-old. These thresholds are lifted by $6,257 for each additional dependent child under 18 and $7,356 for each additional dependent 18- to 24-year-old.
Families receiving Family Tax Benefit Part A may also be eligible for extra payments, such as Rent Assistance if renting privately, the Large Family Supplement for four or more children, and Multiple Birth Allowance for three or more children born during the same birth.
Family Tax Benefit Part B provides extra assistance to single income families including sole parents - particularly families with children under 5 years of age. In a couple, if the secondary earner's income is above $1,616 a year, payments are reduced by 30 cents for every extra dollar of income. Parents receive therefore some Family Tax Benefit Part B if the secondary earner's income is below $10,416 a year if the youngest child is under 5 years of age, or $7,786 a year if the youngest child is between 5 and 18 years of age. There is no income test on the primary earner’s income, so in the case of sole parents the payment is universal.
The previous entry referred to Youth allowance and Parenting Payment. These are income support payments for young people and for parents who are not employed and looking after children respectively.
Ireland
Child Benefit (Sochar Leanaí) is payable to parents of children under 16 years of age, or 19 years if they are in full-time education. The payment is paid by the Department of Social Protection. The monthly payments are as follows:| Number of children | Monthly rate |
|---|---|
| One | €150 |
| Two | €300 |
| Three | €487 |
| Four | €674 |
| Five | €861 |
| Six | €1,048 |
| Seven | €1,235 |
| Eight | €1,422 |
Multiple births are a special case. In the event of twins, 150% of the monthly payment is paid for each child. Triplets, or more, are paid the double (200%) rate each; provided that all of them remain qualified (i.e. stay in further education until 19). In addition, a special 'once-off' grant of €635 is paid on all multiple births. Further 'once-off' grants of €635 are paid when the children are 4 and 12 years old respectively.
Fraudulent claims of Child Benefit are treated very seriously, and can result in 3 years imprisonment or fines of up to €12,697.38.
Sweden
After World War I, many countries were left with dwindling populations. In an attempt to solve this problem, Sweden began a program called "family allowance". These were government funds given to families with children to encourage them to bear more children and increase the birthrate.Today, the guardians of all children aged 16 or younger, are awarded child benefits of 1050 crowns per month.
The couple Alva and Gunnar Myrdal have played a very influential role in the Swedish society. (Alva got Nobel’s Peace prize in 1982 and Gunnar got Nobel’s prize in economics in 1974). You can find more information here: http://sv.wikipedia.org/wiki/Kris_i_befolkningsfr%C3%A5gan
Their book “Kris i befolkningsfrågan” (Crisis in the Population Development”) was published in 1934. It painted a very dark picture of Sweden. The growth of the population would turn negative and Sweden be filled with mostly elderly people.
This book had an important influence and in 1937 child allowance was introduced for poor mothers.
In 1948 child allowance was extended to all families and was then SEK 260 per year or SEK 22 per child and month. The price of milk was then SEK 0.30 per litre so the value of the monthly allowance was 72 litres per milk and year. – Quite a significant contribution. (For my Swedish friends, the price of 1 kg of falukorv was 3 kr)
Using the consumer price index, in 2010 the value would have been SEK 383 per month and child. Today the child allowance is roughly SEK 2000 per month and child.
In 2001 the child allowance increases as the number of children increases. This does of course create an important incentive for people with children to migrate to Sweden.
The number of children borne per mother has decreased as well as the death rates in Sweden as can be seen from the figure below.
Regarding the 1948 decision one woman was interviewed by the Swedish Radio, Mrs. Persson. She had 13 children and one had died. The journalist asked her what she would do with the money. Three of her children went to school and they needed clothes. Perhaps she would save some of the child allowance in case the children would study further. She would not use the money on luxury such as bicycles. She did not plan to spend any money on herself.
One of the heads of the child allowance system was born in 1948 and he believes that there was very little corruption in the system.
Finland
Child benefit scheme was introduced to Finland in 1948 by law. Since the 1920's there was a child benefit allowance that covered state workes with children. In 1948 this benefit became universal following the example of other Nordic countries. Benefit is paid for children until they turn 17, and it is only paid for children that live in Finland. There is also a supplement for single parents. Benefit is paid through national Finnish Social Insurance institution (KELA).| 1. child | 100,40 €/month |
| 2. child | 110,94 €/month |
| 3. child | 141,56 €/month |
| 4. child | 162,15 €/month |
| following children | 182,73 €/month |
| Single parents supplement for every children 46,79 euros. | |
United Kingdom
In the UKUnited Kingdom
The United Kingdom of Great Britain and Northern IrelandIn the United Kingdom and Dependencies, other languages have been officially recognised as legitimate autochthonous languages under the European Charter for Regional or Minority Languages...
, child benefit is administered by Revenue and Customs
Her Majesty's Revenue and Customs
Her Majesty's Revenue and Customs is a non-ministerial department of the UK Government responsible for the collection of taxes and the payment of some forms of state support....
Child Benefit Office in Washington, Tyne and Wear. As of April 2010, £20.30 per week is paid for the first child (including the eldest of a multiple birth) and £13.40 per week is paid for each additional child. The same amount is currently paid without reference to earnings or savings, although higher-rate taxpayers will not receive this benefit from 2013. More than 80% of children are in families also eligible for means-tested child tax credit
Child tax credit
A child tax credit is the name for tax credits issued in some countries that depends on the number of dependent children in a family. The credit may depend on other factors as well: typically it depends on income level. For example, in the United States, only families making less than $110K per...
.
The system was first implemented in August 1946 as "family allowances" under the Family Allowances Act 1945
Family Allowances Act 1945
The Family Allowances Act 1945 was an Act of Parliament in the United Kingdom. It came into operation from August 6, 1946, and was the first law to provide child benefit in the United Kingdom....
, at a rate of 5s
Shilling
The shilling is a unit of currency used in some current and former British Commonwealth countries. The word shilling comes from scilling, an accounting term that dates back to Anglo-Saxon times where it was deemed to be the value of a cow in Kent or a sheep elsewhere. The word is thought to derive...
per week per child in a family, except for the eldest. This was raised from September 1952, by the Family Allowances and National Insurance Act 1952, to 8s, and from October 1956, by the Family Allowances Act and National Insurance Act 1956, to 8s for the second child with 10s for the third and subsequent children. By 1955, some 5,000,000 allowances were being paid, to about 3,250,000 families.
It was modified in 1977, with the payments being termed "child benefit" and given for the eldest child as well as the younger ones; by 1979 it was worth £4 per child per week. In 1991, the system was further altered, with a higher payment now given for the first child than for their younger siblings. In October 2010, the Conservative-Liberal coalition government announced that Child Benefit would be withdrawn from households containing a higher-rate taxpayer from January 2013.
See also
- Baby BonusBaby BonusThe Baby Bonus is a government payment to parents of a newborn baby or adopted child to assist with the costs of childrearing.- Australia :The government of Andrew Fisher introduced a baby bonus of £5 per child in late 1912. The bonus was available irrespective of marital status and could also be...
- Parental LeaveParental leaveParental leave is an employee benefit that provides paid or unpaid time off work to care for a child or make arrangements for the child's welfare. Often, the term parental leave includes maternity, paternity, and adoption leave...
- Taxation in the United KingdomTaxation in the United KingdomTaxation in the United Kingdom may involve payments to a minimum of two different levels of government: The central government and local government. Central government revenues come primarily from income tax, National Insurance contributions, value added tax, corporation tax and fuel duty...
- UK labour law