The Government has launched two new childcare schemes this year in order to help working parents with childcare costs.
- Tax-Free Childcare account: Topped up £2 by the Government for every £8 that is paid in. Open to children who will be aged 4 on August 31, 2017. Can be used by all working parents, including the self-employed.
- 30 hours free childcare: Starting in September 2017 parents of 3-4 year-olds can apply for 30 hours of free childcare (via a childcare provider).
Parents can apply for both schemes, only a single application needs to be made for both.
Tax-Free Childcare will cut childcare costs by up to £2,000 per year for each child under 12 years old, or £4,000 per year for disabled children under 17 years old.*
This new scheme has been designed to replace the Childcare Vouchers Scheme.
“It is very important that working parents register for these schemes, the 30 hours free childcare is worth £5,000 per child,” said Peter Way-Rider, tax manager at Ellis & Co.
“To qualify you need to earn a minimum of £120 per week and less than £100,000 a year (joint income if you have a partner).
“The Tax-Free Childcare scheme cannot be used at the same time as childcare vouchers, Universal Credit or tax credits; the 30 hours free childcare can be used alongside any of the schemes,” he added.
To find out more and how to apply visit https://www.childcarechoices.gov.uk or contact Peter Way-Rider on 01244 343504.
*Figures by HMRC.