Tax-Free Childcare will replace the existing Childcare Voucher Scheme from the 1 October 2018. Parents already receiving childcare vouchers will be able to continue to use them after October if their current employer continues to offer the voucher scheme, but no newcomers will be accepted.
Tax-Free Childcare was launched last April and has gradually been rolled out over the past 12 months. This is a new government scheme will provide help for parents with their childcare costs. Whereas childcare vouchers have been processed through the
payroll, the new system will be administered by parents through an online account which can be accessed via HMRC’s website. You may be eligible for this scheme if both you and your partner are in work and earning over £120 per week. If either of you earn over £100,000 per annum you will not be eligible. Tax Free Childcare offers up to £2,000 a year per child (the government will pay £2 for every £8 you pay in up to the £2K limit) to help with the costs of childcare. The money can go towards a whole range of regulated childcare, whether nurseries, child minders, after-school clubs or holiday clubs. You can find out more on the Childcare Choices website.
Download our Fact Sheet on Tax-Free Childcare.
If you would like to find out more about Tax-Free Childcare, please do get in touch with the DRG Chartered Accountants team - we would be delighted to hear from you.
DISCLAIMER: This information is for guidance only, and professional advice should be obtained before acting on any information contained herein. We will not accept any responsibility for loss to any person as a result of action taken or refrained from in consequence of the contents of this publication.