Tax-Free Childcare

 

Tax-free childcare

 

Way back in 2013 the government proposed tax free childcare for working parents.  It’s been an extended gestation period for this tax break, but after numerous amendments and a legal challenge the scheme is on the verge of being launched. 

The scheme is due to be rolled out gradually from Spring 2017, available to those with the youngest children first.

 

Here’s a summary of the government’s proposal for tax-free childcare:

• Parents with children aged up to 12, or 17 if they have disabilities, will be able to apply for on online account which money can be paid into.  The government will gross up by 20% any amounts paid into the account, so for each 80p contributed the government will put in 20p.
• The money in the account can only be used to pay for childcare with a carer registered to receive a tax-free childcare payment.
• To qualify parents must be employed and earn at least £115 per week, but less than £100,000 per year.  The parents must not be receiving free or subsidised childcare, or childcare vouchers from their employer.

 

To receive email updates on when you become eligible for the scheme
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