The phrase "family allowance" still rolls off the tongue for millions of people across Great Britain, even though the official benefit it refers to was replaced decades ago. Understanding how the UK moved from five shillings per week in the 1940s to the modern Child Benefit system in 2026 matters for every parent planning their household finances. This guide walks through the full story, from wartime legislation to current rates, and unpacks what families actually need to know right now.
Key Takeaways
The historic family allowance was introduced by the Family Allowances Act 1945, offering universal payments to mothers for second and subsequent children from August 1946. It was replaced by child benefit in 1977.
There is no longer a separate child tax allowance in UK income tax. It was abolished in 1979 and its value was rolled into higher Child Benefit rates and later into tax credits and Universal Credit.
Child benefit remains the main universal cash payment for families in 2026. It is paid for each child you are responsible for, regardless of family size or income at the point of claim.
Since January 2013, child benefits became means tested for high earners through the High Income Child Benefit Charge. Families where the higher earner has adjusted net income above £60,000 face partial or full clawback.
Claiming Child Benefit also protects your State Pension record through national insurance credits, making it worth registering even if you opt out of receiving payments.
What Is “Family Allowance” in the UK Today?
When people in the UK talk about "family allowance," they are usually referring to what is now officially called Child Benefit. The original family allowance was a state payment introduced after the Second World War to provide financial support for families with dependent children. Although the name has changed, the core idea remains: a regular cash payment from the government to help parents with the cost of raising children.
In UK law and government guidance, the current core benefit is called Child Benefit. Modern family support also includes means tested benefits like Universal Credit, which has largely replaced older tax credits. There is no stand-alone child tax allowance in the income tax system anymore. The sections below cover the history under the Family Allowances Act, the key changes of the 1970s and 2010s, and the rules and current rates that apply in 2026.
Historical Background: Family Allowances Act and Early Child Tax Allowance
Understanding the origins of family allowance helps explain why Child Benefit looks the way it does in 2026. The story stretches back well over a century.
The first child tax allowance appeared in the 1909 People's Budget, passed through the Finance Act of that year. It gave a £10 income tax allowance per child to earners with incomes under £500. This was valuable for middle-income families, but it did nothing for the poorest households who paid little or no income tax. Male workers and higher rate taxpayers gained the most from this arrangement, which created a gap in support that campaigners spent decades trying to close.
Eleanor Rathbone campaigned for family allowances in the 1920s, arguing that direct cash payments to mothers were the best way to alleviate poverty among children. Her work influenced the Beveridge Report of 1942, which proposed universal payments of eight shillings per week per child to tackle child poverty as part of the new welfare state.
The Family Allowances Act was passed on 15 June 1945, with payments starting in August 1946. The initial family allowance was five shillings per week per child - paid for each subsequent child after the first child, not for only one child. In today's money, that five shillings had meaningful real value for working-class families. The allowance was funded from general taxation and was a universal benefit, available to all regardless of household income.
The payment was originally proposed to go to fathers, but after sustained lobbying - Rathbone's influence was decisive - Parliament agreed to pay it directly to mothers. This early act of the post-war government helped establish the principle that financial support for children should reach the person most likely to spend it on the child.
Family allowance sat alongside child tax allowance for several decades. The tax relief helped tax-paying parents reduce their income tax bill, while the cash benefit helped lower-income and larger families. Cabinet papers from the era show ongoing debate about whether both mechanisms were needed. Eventually, the original Act was swept from the statute book by the Statute Law Revision (Consequential Repeals) Act 1965, though payments themselves continued under later legislation.
From Family Allowance to Child Benefit and End of Child Tax Allowance
By the early 1970s, the patchwork of family allowances and child tax reliefs was widely seen as inefficient and inequitable. The government moved to simplify the system into a single cash payment that would support all families equally.
During the 1970s, governments expanded the old family allowance. From 1975, the first child was brought into eligibility for the first time, ending the long-standing rule that only the second and subsequent children qualified. This was a significant rise in the scope of support.
Family allowances were replaced by child benefits in 1977 under the Child Benefit Act 1975. The new benefit combined the value of the old cash family allowance and the child tax allowance into one payment, paid to the main carer - usually the mother. This change made support more equal across income levels, since the old tax allowance had mainly helped earners in the higher rate bracket.
The separate child tax allowance in the income tax system was abolished for 1979–80 onwards. The April 1979 Budget, delivered under the law of the Finance Act, formally ended child allowances and raised Child Benefit to £4 per week for each child. The extra value that had previously existed as a tax allowance was transferred directly into higher child benefit payments.
Through the 1980s and 1990s - including the years under John Major's government - child benefit remained non-means tested. Rates were periodically uprated, though not always in line with inflation. From 1991, a distinction was introduced: a higher payment for the first child, with a lower amount for each additional child.
Modern System: Child Benefit as Today’s Family Allowance
Here is how Child Benefit works in 2026, set out as plainly as possible.
Eligibility
You must be responsible for a child under 16, or under 20 if they are in approved education or training.
Eligibility includes being responsible for a child living with you. You do not need to be the biological parent to claim Child Benefit - guardians, adoptive parents, and other carers can also qualify.
Only one person can claim Child Benefit for a child at any given time.
There is no limit on the number of dependent children you can claim for.
You must be normally resident in the UK. Certain immigration circumstances may affect eligibility.
How to Claim
To claim child benefit, fill in the Child Benefit claim form (CH2) and send it to HMRC along with the child's birth certificate or adoption papers.
Claiming Child Benefit automatically triggers a National Insurance number for the child, which they will need later in life for employment and social security purposes.
The application for Child Benefit can be backdated for up to three months, so it is worth submitting your claim as early as possible to avoid losing any receipt of payment.
A new payment method for Child Benefit started in 2025, streamlining how HMRC processes claims.
Current Rates
Child Benefit rates have been frozen or minimally uprated at various points since 2010, though recent years have seen increases. As of April 2026:
Eldest or only child: £27.05 per week
Each additional child: £17.90 per week
For context, the current Child Benefit rate was £24 per week for the first child before the most recent uprating. Over a full year, a family with two children receives approximately £2,337 before any tax charge.
From a previous year comparison, rates for 2025–26 were £26.05 (eldest or only child) and £17.25 (additional child).
Payment Details
Child benefit payments are usually made every four weeks into a bank account. In some circumstances - for example, for lone parent families or those on certain social security benefits - weekly payments may be available.
Child Benefit is a tax-free payment for parents or guardians responsible for children. It is not counted as taxable income for most purposes. However, it can interact with tax through the High Income Child Benefit Charge, covered below.
Impact on Family Income, Tax Allowance and National Insurance
Although family allowance and child tax allowance have changed names and forms over the decades, they still directly affect overall family income and long-term finances.
Child Benefit increases disposable family income and is often used to cover essentials such as food, clothing, and school-related costs. For larger families, the cumulative value across several children adds up to a meaningful sum each month.
The link to national insurance contributions is especially important. National insurance credits are earned through claiming Child Benefit. Specifically, carers of children under 12 who receive Child Benefit generally receive Class 3 NI credits, helping protect their State Pension entitlement. The claiming parent earns national insurance credits which protect their State Pension record - even if they are not in paid employment at the time.
There is no current child tax allowance in the UK income tax system. Child-related support now comes via Child Benefit, Universal Credit (which replaced older tax credits for most families), and for some legacy claimants, Child Tax Credit.
Example: Consider a family with two children where one parent works and earns £30,000 per year. Their monthly Child Benefit comes to roughly £195 (£27.05 + £17.90 per week ÷ 4 × monthly). Combined with earnings and any Universal Credit entitlement, this payment helps cover the additional cost of raising two children and contributes to household income that might otherwise fall short.
High Income Child Benefit Charge and Higher-Earning Families
Since January 2013, Child Benefit has been partially means tested through the High Income Child Benefit Charge (HICBC). This affects households where the higher earner's adjusted net income exceeds a set threshold. Child benefits became means tested in January 2013, and the rules have been updated several times since.
How the Charge Works
The HICBC is an income tax charge on the person in the household with the highest adjusted net income. Child Benefit can be claimed regardless of income, but a tax charge applies for incomes over £60,000 (the threshold as of 2024–25 onwards, raised from the earlier £50,000 level). Historically, families earning over £50,000 lost part of their Child Benefit - the threshold increase in April 2024 gave relief to many earners who had previously been caught.
Between £60,000 and £80,000 of adjusted net income, the charge equals 1% of the full Child Benefit entitlement for every £200 of income above £60,000. Once income exceeds £80,000, the charge claws back 100% of the benefit - meaning no full child benefit is retained in practice.
Affected taxpayers may need to register for Self Assessment to pay the charge, even if they are PAYE employees with no other reason to file a return.
The Opt-Out Option
Families can continue to claim child benefit to keep NI credits but opt out of receiving the actual child benefit payments. This avoids building up a tax charge while still protecting the carer's pension record.
Worked Example
A family with two children receives approximately £2,337 per year in Child Benefit. If the higher earner has £70,000 adjusted net income:
Income above threshold: £10,000
Number of £200 units: 50
HICBC charge: 50% of £2,337 = roughly £1,169
Net benefit retained: approximately £1,168
If that same person increased pension contributions to bring their adjusted net income below £60,000, they would keep full benefit with no charge at all. This kind of planning can make a real difference to family income.
The effective marginal tax rate in the £60,000–£80,000 band is notably high when HICBC is layered on top of 40% income tax and 2% National Insurance, sometimes exceeding 53% for families with multiple children.
Other Historic and Related Supports: Family Income Supplement and Family Credit
Alongside family allowance and Child Benefit, the UK used various means tested top-ups for low-income working families.
The Family Income Supplement (FIS) was introduced in 1970 under Edward Heath's government. It aimed to help low-paid male workers and lone parent families with children, payable where at least one adult worked a minimum number of hours per week. It was designed to alleviate poverty among working households whose family income fell below a set level.
FIS was replaced by family credit under the Social Security Act 1986. This continued targeted help to families whose earners were in employment but whose pay was too low to meet basic costs comfortably. The lone parent rate under family credit provided additional support.
The system then shifted to Working Families Tax Credit in 1999, followed by Child Tax Credit and Working Tax Credit in the early 2000s. These tax credits provided child tax support alongside other elements. Finally, Universal Credit began its phased roll-out from 2013 onwards, absorbing most of these earlier schemes.
While these programmes are distinct from the universal Child Benefit, they form part of the broader picture of support for family income and child costs. Together with the national health service and other pillars of the welfare state, they represent the UK's evolving approach to reducing child poverty and supporting families of every family size.
Frequently Asked Questions About Family Allowance and Child Benefit
Is There Still a “Family Allowance” in the UK, or Is It All Child Benefit Now?
The term "family allowance" is now mainly historical. Payments to parents in 2026 are made under the name Child Benefit, administered by HMRC. Some people and older sources still use "family allowance" informally, but there is no separate benefit by that name in current law. The allowance was formally replaced in 1977, and the act that created it has long since been repealed.
Can I Claim Child Benefit If I or My Partner Earn Over £50,000 a Year?
Yes, you can still claim. However, if the higher earner in your household has adjusted net income above £60,000 (the threshold as of tax year 2024–25 onwards), you may have to pay some or all of it back through the High Income Child Benefit Charge. The charge is based on the higher earner's adjusted net income, not on joint household income. You can reduce your adjusted net income through pension contributions or Gift Aid donations to keep below the threshold.
Do I Lose State Pension Rights If I Do Not Claim Child Benefit?
Potentially, yes. Carers of children under 12 gain national insurance credits through claiming Child Benefit. If you do not take up the claim, you risk gaps in your NI record that could reduce your State Pension entitlement. Some parents in higher-earning households choose to claim but opt out of receiving the money, which preserves the credits without triggering the HICBC tax charge.
What Happened to Child Tax Allowance - Can I Claim It on My Tax Return?
The old child tax allowance was abolished from 1979–80. Its value was passed into higher Child Benefit rates and, later, into tax credits and Universal Credit. There is no separate line for "child tax allowance" on modern UK income tax returns. If you have children, your financial support comes through Child Benefit and, for eligible families, Universal Credit or legacy benefits - not through any income tax deduction.
Can I Backdate a New Child Benefit Claim If I Forgot to Apply When My Baby Was Born?
The application for Child Benefit can be backdated for up to three months from the date HMRC receives your claim. If you delayed longer than that, you will lose the earlier payment entitlement. Check the current HMRC rules for the exact limit, and submit your claim as soon as possible after your child is born or comes into your care.
