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What is tax free childcare?

February 25, 2019 2:32 pm

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Tax-Free Childcare is a new scheme which is being rolled out gradually from 21 April 2017 and will offer working families 20% support towards qualifying childcare costs up to certain limits. … The scheme will eventually be open to almost two million families in the UK and is administered by HM Revenue and Customs (HMRC).

Tax free childcare is available to working parents with children under 12 (or under 17 for disabled children), you can now open an online account that allows you to pay for registered childcare. The government will top-up the money you pay into your account. For every £8 you pay in, the government will add another £2. Through this scheme you can receive up to £2,000 per child – that’s up to £500 every three months. If you have a disabled child, you can receive up to £4,000 per child – that’s up to £1,000 every three months.

You, and any partner, must each expect to earn at least £120 per week. If you, or your partner, are on maternity, paternity or adoption leave, or you’re unable to work because you are disabled or have caring responsibilities, you could still be eligible.

If either you, or your partner, expect to earn £100,000 or more, you can’t get Tax-Free Childcare.

You can’t use Tax-Free Childcare alongside childcare vouchers, Universal Credit or tax credits. However you can still use it alongside the 15 hours and 30 hours schemes.

This scheme can help you to pay:

Registered childminders, nurseries and nannies

Registered after-school clubs and play-schemes

Registered schools

Home care workers working for a registered home care agency

For more detailed information see https://www.moneysavingexpert.com/family/tax-free-childcare/ & https://www.gov.uk/tax-free-childcare