Tax-Free Childcare Opens to Parents of Under 12’s
HMRC has now announced the extension of tax-free childcare accounts to under 12’s. Parents can now get up to £2,000 a year towards childcare costs, if their youngest child is under 12. The scheme has been launched in a bid to help working parents with the cost of childcare.
Parents, including the self-employed, can apply for the tax-free childcare scheme online and reduce their childcare costs by up to £2,000 per child per year, or £4,000 for disabled children.
The scheme, initially launched in April 2017, has been gradually rolled out to parents, with all eligible parents now able to apply across the UK.
The money can go towards a whole range of regulated childcare, whether nurseries, childminders, after-school clubs or holiday clubs. You can find out what help is available on the GOV.UK webpage’s Childcare Choices. This website includes a childcare calculator that compares all the governments childcare offers to check what works best for individual families.
Parents in England can also apply for 30 hours free childcare through the same online application and are encouraged to apply now for the April term.
Employer Supported Childcare
The Employer supported ‘Childcare Voucher’ will eventually be replaced by the new Tax-Free childcare scheme. Parents can still join an employer supported childcare scheme as long as they receive a childcare voucher before 5 April 2018. Parents will still be able to use the Childcare vouchers after April 2018, while their employer continues to offer the scheme.
If a parent does decide to join the Tax-free childcare scheme after using the voucher scheme, they will need to provide a written document or email to their employer stating their wish to leave the voucher scheme and use Tax-free childcare. You will have 90 days to notify your employer of this after opening the Tax-free childcare account. The employer will then need to terminate their employer supported childcare.
If you would like further information on this, then please contact us or you can visit the GOV.UK webpage ‘What do childcare providers need to know?’