The Department of Social Care will introduce means testing for child benefit.
It will begin in April next year if Tynwald approves the plan later this month.
The change will see child benefit stopped completely for 10 per cent of families with an annual income of over £90,000.
Those with an annual income below £60,000 will continue to receive the benefit.
The move is expected to save £2.5 million per year.
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