Families to save thousands thanks to tax-free childcare

tax-free childcare

A new scheme announced today (14th February), opens tax-free childcare up to eligible working parents who have children under 12 years old

Parents, including the self-employed, can apply online for Tax-Free Childcare by visiting Childcare Choices. Parents can also access the government’s childcare calculator through Childcare Choices, which helps parents to choose which government support is best for them.

For every £8 parents pay into their childcare account, the government will add an extra £2, up to £2,000 per child per year.

Elizabeth Truss, Chief Secretary to the Treasury, said:

“Tax-Free Childcare will cut thousands of pounds from childcare bills and is good news for working parents.

More parents will be able to work if they want to and this demonstrates our commitment to helping families with the cost of living.”

The money can go towards a whole range of regulated childcare, including nurseries, childminders, after-school clubs and holiday clubs.

HM revenue and Customs has been gradually rolling out Tax-Free Childcare since April 2017.

The new scheme is built upon an existing childcare service, which provides 15 hours free childcare for families in England, enhanced childcare support via Universal Credit and tax credits for childcare.

Nicole, a mum of twins from Greater London, who uses Tax-Free Childcare, said:

“I was concerned about the cost of childcare because I don’t get any other support. I’m a single mum with 15-month-old twins and Tax-Free Childcare has taken a big burden off my shoulders

“It’s massively helped me: the extra money makes a huge difference, and I find the system really easy to use. It allows me to comfortably work full time, knowing that my children are being well looked after.”

Since opening the service, through which parents can apply for both Tax-Free Childcare and 30 hours free childcare, more than 340,000 families have successfully applied. Of these, more than 190,000 have a Tax-Free Childcare account.

However, recent figures suggest that less children attend school nurseries now due to the scheme. For more on this, please click here.


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