New Tax-Free Childcare Scheme
A new tax-free childcare scheme has been introduced this year allowing around 2 million households to reduce the cost of childcare, including self-employed parents.
How does the new scheme work?
Parents with children under 12 years old can open an online account and pay in the amounts they would like for childcare provided by a registered childcare provider.
For every 80p that is paid, the government will top up an extra 20p. In total, the government can top up a total of £2,000 per child.
Who is eligible for the new scheme?
To be eligible to join the new scheme both parents must:
– Be working a minimum 16 hours per week
– Be earning at least £120 per week but less than £100,000 per year
– Not receiving support though tax credits
– Not getting support though an existing Childcare Voucher Scheme
What if you are already using the existing Employer-Supported Childcare?
The existing Employer-Supported Childcare will continue to run and parents can join the scheme until April 2018. Parents who are already registered can continue using it for as long as it is offered by their employer.
To find out more about the new childcare scheme or to discuss in more detail what the process is, please do not hesitate to contact us.