Tax-Free Childcare is a government scheme (launched in 2017) to help working parents/carers with the cost of childcare.
Either parent must earn under £100k/annum
To be eligible, you must:
- Have a child living with you.
- Have a child under 12, or under 17 if disabled.
- Be in paid work (both parents/carers or the single parent). Working includes both employed or self-employed with an expected income of at least £125 a week on average.
- Earn less than £100K (either parent/carer).
- Not be receiving other government support towards the cost of childcare (i.e. Childcare Vouchers, Tax Credits, Universal Credit, Student Bursary, etc)
- Check your eligiblity on the Childcare Choices website.
Parents with children under 12 can apply now
- Tax-Free Childcare (TFC) is now open to all eligible families with children aged under 12 and all eligible parents with disabled children under 17 can apply. Click here to sign-up.
Tax-Free Childcare can save up to £2K per child
- You will be able to open an online childcare account for each of your children.
- For every £8 you pay into your childcare account, the government will automatically pay in an extra £2.
- You can get up to £500 per child every three months (£2K per year) towards your childcare costs.
- You can use this money to pay your nanny.
It is managed via an online platform
- Parents/carers manage Tax Free Childcare via an online childcare account.
- The online childcare account will allow parents/carers to open an account, find their childcare provider via a search facility, and set-up payments to their childcare provider and can parents can pay HMRC directly.
- Click here to sign in or sign up.
Tax-Free Childcare for Nannies
- Your nanny must be registered with a regulator (i.e. Ofsted) in order for you use Tax-Free Childcare.
- As a nanny employer, you will be able to send payments directly from your online childcare account into your nanny's bank account, provided that your nanny is signed up to the system.