If you are a working parent or carer, you may be able to save money on your childcare bill using Tax-Free Childcare.
Tax-free childcare can be used for children from birth to 11 years old. This is extended to age 16 if your child is disabled.
It can be used to save money with registered providers including:
- childminders, nurseries, pre-schools, and nannies
- before school clubs
- after school clubs
- holiday clubs
Parents should check with their provider to see if they are signed up to accept Tax-Free Childcare.
How it works
- You set up an online childcare account for your child.
- For every £8 you pay into this account, the government will pay in £2.
- You then transfer the funds to your selected childcare provider.
- Renew eligibility at least every three months.
You can save up to £2,000 a year per child on the costs of childcare. This increases to £4,000 per year if your child is disabled.
Am I eligible?
To get Tax-Free Childcare, you, and your partner (if you have one) need to be working at least 16 hours a week and expect to earn at least the National Minimum Wage or National Living Wage over the next three months. If you work less than 16 hours per week, you need to be earning the equivalent of 16 hours per week at National Minimum Wage or National Living Wage.
Each parent or carer can earn up to £100,000 per year and still be eligible for Tax-Free Childcare.
Your eligibility doesn’t depend on how much tax you pay, so it won’t affect your income tax liability or VAT.
You can’t claim Tax-Free Childcare at the same time as Universal Credit or employee childcare vouchers.
For more information and to apply, please visit Childcare Choices