The government announced its tax-free childcare scheme was open to all eligible families, in 2018, almost a year after it was initially launched.
Working parents who earn more than £140 a week and less than £100,000 a year are eligible for the scheme if they have children aged 11 and under or under 17 for disabled children.
This allows them to open an online account for savings used to cover childcare costs, including nurseries, childminders, breakfast clubs, after school clubs and holiday clubs.
For every £8 paid in, the government adds an extra £2, up to a limit of £2,000 per year – or £4,000 for parents of disabled children.
The scheme was launched in April 2017, but was delayed after several parents reported technical difficulties.
It has since been gradually rolled out for children by age group.
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.
All eligible parents with children under 12 can now apply through Childcare Choices and should take advantage of the available support.”
Tax-Free Childcare and Coronavirus
If you’re working less and earning less due to coronavirus, you will still be entitled to the additional 15 hours of free nursery time as well as government assistance in saving, even if you aren’t making £140/week.
Critical workers who are working and earning more as a direct result of coronavirus, will still be eligible for 30 free hours and tax-free childcare.
If you are made redundant, unfortunately you are no longer eligible as you’re no longer working or meeting the minimum income requirement. However, if you become employed somewhere else, you can apply for the scheme 31 days before starting your new job.
Talk to us about tax-free childcare.