Tax-free childcare roll out
The implementation of Tax-Free Childcare, the new government scheme to help working parents with the cost of childcare, is being rolled out to eligible parents in stages.
The scheme first made its debut in April 2017 and although there have been initial systems problems, HMRC’s aim is to have the scheme open to all eligible parents by 14 February 2018. Application is made online through the Childcare Choices site www.childcarechoices.gov.uk and applications can be made for all eligible children at the same time.
Under Tax-Free Childcare, for every £8 the parent pays, the government provides a £2 top-up, to a maximum of £2,000 per child each year – with a higher limit of £4,000 for disabled children. This gives a total childcare pot of £10,000, or £20,000 for disabled children. To be eligible, parents must generally have minimum weekly earnings of at least £120 each. There is also an upper earnings limit of £100,000.
Compensation may be available in certain circumstances where a parent:
- is unable to complete an application for Tax-Free Childcare
- is unable to access their childcare account
- or doesn’t get a decision about whether they are eligible, without explanation, for more than 20 days.
Those employing a nanny should be able to use the childcare account to pay their PAYE tax and National Insurance. Delays in getting this system working may also give grounds for compensation. Application is made online GOV.UK childcare-service-compensation
For more information: GOV.UK childcare under 9s
Petaurum Solutions’ Comment
Actually, there is a fantastically informative article on The Huffington Post “Childcare Vouchers Vs Tax-Free Childcare: What Do The Changes Mean For You?” so rather than re-invent the wheel we’ll direct you to the following link.