Tax-Free Childcare

Tax-Free Childcare launches for parents from early 2017 as a new Government scheme to help working families with their childcare costs.

The scheme will allow eligible parents to open online childcare accounts to make payments direct to their registered childcare providers. For every £8 parents pay in to these accounts, the Government will add £2, and the total amount in the account can only be spent on childcare. Parents can receive up to £2,000 in Government support per child, per year, or £4,000 for disabled children.

Are you a childcare provider?

Over 100,000 registered childcare providers across the UK have now received invitations to sign up to Tax-Free Childcare. Letters were posted throughout September and October, containing a unique sign up code. As a childcare provider you need to sign up for Tax-Free Childcare to be able to receive payments from parents, via the scheme. You should act now to sign up, using your
unique code contained in your invitation.

To sign up you will need your unique sign up code. Once you are in the secure site you will need to:

• Confirm your unique taxpayer reference (UTR) number; or your National Insurance number, if you are a nanny and don’t have a UTR
• Provide bank details for the account you wish to receive Tax-Free Childcare payments into.

To sign up, and find out more, childcare providers should visit www.childcare-support.tax.service.gov.uk

And wider employers?

Employers should note that parents (or a household) cannot claim both childcare vouchers and Tax-Free Childcare – so you may get requests from your employees to cancel their current vouchers, as Tax-Free Childcare is introduced.  A guide has been produced for parents, which sets out how the current Employer-Supported Childcare scheme will remain open to new entrants until April 2018.  After April 2018, parents already registered for Employer-Supported Childcare will be able to continue using it as long as you continue to offer it.

Your employees can find further information at
www.gov.uk/government/news/tax-free-childcare-10-things-parents-should-know

If you or your employees need help with this, contact us and we will be pleased to discuss this in more detail with you.