Thousands more families can now claim tax-free childcare – after the Government extended its Tax-Free Childcare scheme to children under nine.
Here’s what you need to know.
Why is this being introduced now?
The government introduced Tax-Free Childcare in April 2017. This latest announcement is part of a continuing roll-out.
So what’s changing?
Some families currently get childcare vouchers through their employers to help towards costs, but from April 2018 this scheme will close to new applicants, who may instead be eligible for the new scheme – Tax-Free Childcare.
People who already get childcare vouchers may be able to continue to get them for as long as their employer runs the scheme, or as long as they stay with their employer.
Could we lose out under the new scheme?
Some people think so – more than 116,000 have signed a petition for the government to keep the childcare voucher scheme open beyond April.
Campaigners say hundreds of thousands of families will lose out and the only way to provide “genuine choice” for support is to keep the voucher schemes open to run alongside the new scheme.
How much can you save with the new Tax-Free Childcare scheme?
Working parents can save up to £2,000 per child off the cost of childcare a year, or £4,000 for disabled children.
Who’s eligible?
Tax-Free Childcare is open to parents whose youngest child is under nine, or who turned nine on January 15.
The scheme will open to all remaining eligible families with children under 12 on February 14 this year.
This means all eligible parents will be able to apply for Tax-Free Childcare before the end of this financial year.
It also includes parents who are self-employed.
Which scheme can I save the most with?
It depends on your situation.
If you apply for Tax-Free Childcare and you’re successful, you can’t continue to claim childcare vouchers.
Parents can go online at and use the childcare calculator at www.childcarechoices.gov.uk to work out which type of support is best for them.
Parents can continue to use any vouchers they may already have, including to make a joint payment for childcare with Tax-Free Childcare. There’s no deadline for using the vouchers.
Once you’ve told your employer that you’re getting Tax-Free Childcare, you can’t rejoin their voucher scheme.
How do I apply?
Online, by visiting Childcare Choices – www.childcarechoices.gov.uk
Is this a better deal for families?
The government says it’s giving more support to families than ever; around £6bn in total. It’s doubled the free childcare available to working parents of three and four year-olds to 30 hours a week for families.
Around 325,000 families in England have successfully applied for the 30 hours free childcare since it launched.
Source: GazetteLive | Kelley Price | 16th January 2018