Child benefit will only be withdrawn if someone in the household earns over £50,000, the government announced today.
In his 2012 Budget Chancellor George Osborne said he wanted to avoid a "cliff-edge that means people lose all their Child Benefit when they earn just a pound more."
"So I can today confirm that instead of withdrawing child benefit all at once when people earn more than the higher rate threshold – the benefit will only be withdrawn when someone in the household has an income of more than £50,000," he said.
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"And the withdrawal will be gradual, 1% of child benefit for every extra £100 earned over £50,000 so there is no cliff-edge, and only those with an income of more than £60,000 lose all their child benefit."
The move is expected to help an extra 750,000 keep all or some of their child benefit. Nine out of 10 of families are still eligible for child benefit.
It comes after months of reports that Treasury officials were looking at raising the eligibility cut-off point amid fears of a backlash from middle-class voters.
Labour has also attempted to ramp up pressure on the issue by using an Opposition day debate in the House of Commons earlier this month to call for an urgent review of the reforms.