Act now on Childcare Vouchers

Are you looking to provide an employee benefits scheme?  Act now to ensure your employees can take advantage of current schemes before they are no longer available!

Tax-free childcare will see the Government subsidising 20% of an employee’s childcare costs, providing a saving of up £2,000 per child, each year. To access these savings, parents must spend £8,000 per year. The current Childcare Voucher system can save each parent up to £933 per year for an outlay of only £2,916, therefore many parents will be better off continuing to use Childcare Vouchers, such as those employees that fall into any of the categories below:

  • Middle / low earning parents
  • Basic Rate tax payers spending less than £9,336 on childcare each year
  • Families with only one working parent
  • Families only using childcare a few days a week
  • Families using before and after school care and holiday clubs
  • Families using Childcare Vouchers for activities and additional lessons through an Ofsted registered childcare provider or the Independent School sector
  • Families with children using childcare over the age of 12
  • Families who want to start saving towards childcare costs as soon as their baby is born
  • Family run businesses where savings can be made on PAYE, Employers and Employee National Insurance and Corporation Tax
  • Families wanting to keep their Child Benefit payments

When Tax-free Childcare is launched, only those employees already using Childcare Vouchers can continue to benefit from their savings – new parents will not be able to join a Childcare Voucher scheme.

Childcare Vouchers will remain available for as long as they are required. Therefore, you need to be promoting your scheme, ensuring all employees currently paying for or intending to pay for registered childcare, know about your scheme and understand how they can make savings. Even if employees will be better off using Tax-free Childcare, they could save a maximum of £544* using Childcare Vouchers before the new scheme is launched. This could be even more if both parents join their employer’s Childcare Voucher Scheme. Employees only need to have a deduction of £10 a month to remain in the scheme.

The more employees in your scheme, the more your organisation will save on Employer’s National Insurance contributions.

Many Childcare Voucher providers will be disappearing from the market – rest assured, our Childcare Voucher provider, Busy Bees, are not going anywhere! They will continue to provide Childcare Vouchers to your organisation as long as they are needed. Their association with Busy Bees Nurseries, the largest nursery network in the UK, means their financial stability will be supported throughout the changes and beyond. Your funds are safe with Busy Bees as they are ring-fenced and not used to fund their operating expenses. There are few providers that can give you such a guarantee.

Spread the word to your employees, even those that do not have a requirement for childcare vouchers at the current time, from April 2015 they only need to have a deduction for as little as £10 to join your Childcare Voucher scheme….and vouchers can be saved up to be used when they are required.

Information provided by our Childcare Voucher Partner, BusyBees

Petaurum Solutions Comment

With employers increasingly looking at ways to reward employees and employees looking to maximise their spending power, providing a Flexible Benefits Scheme is one way to meet these needs.  With some benefits, such as Childcare Vouchers, providing a range of National Insurance savings for both employer and employee these schemes are becoming increasingly popular. With government changes due to come into effect in the autumn, now is the time to take advantage. At Petaurum Solutions we have a wide range of Employee Benefits Schemes to meet all of your needs from our free to access Benefits Lite, offering point of sale discounts at over 300 retailers, to our ‘pay as you go’ Core and Core Plus schemes offering Childcare Vouchers, Cycle to Work and Gym schemes to name but a few. Want to know more? Contact us we would love to talk to you.

This information is intended as a general overview and discussion of the subjects dealt with. The information provided here was accurate as of the day it was posted; however, the law may have changed since that date. This information is not intended to be, and should not be used as, a substitute for taking legal, HR or benefits advice in any specific situation. Petaurum Solutions is not responsible for any actions taken or not taken on the basis of this information. Please refer to the full terms and conditions on our website.

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