HM Revenue and Customs has reminded families that they can save up to £2,000 a year towards childcare costs by signing up to Tax-Free Childcare.
This can help pay for holiday clubs and wraparound care, offering a significant advantage to those who have children up to the age of 11, or 17 if their child has a disability.
Sally Allsop, writer/editor at Life Loving, who has signed up to Tax-Free Childcare, said: “It has allowed my child to gain valuable social skills; they do lot of great activities which help him to learn and develop.”
By not missing the chance to save up to £500 every three months, saved funds could go towards childminders, nurseries, before and after-school clubs and other approved childcare schemes.
These are fundamental to children’s education and ensures they can form relationships with others and cooperate in social environments.
Sally added that it has given her and her husband the option to send their child to their preferred nursery.
This further demonstrates how funding can help families who have limited options for childcare due to their economic status, enabling them to do what they think gives their child the best opportunities and start in life.
“It’s simply made childcare more affordable.”
Parents and carers are eligible for Tax-Free Childcare if they have a child up to the age of 11 and earn or expect to earn at least the National Minimum Wage for 16 hours a week.
Each parent or carer must earn under £100,000 per year, and not receive tax credits, universal credit, or childcare vouchers.
If their child has a disability, this funding is available until the child is 17 years of age, and families can save up to £1,000 every 3 months – double the usual amount.
More than 51,000 families in the North West benefitted from this government funding and saved money on their childcare costs in June 2022.
Myrtle Lloyd, HMRC’s Director General for Customer Services, said: “Tax-Free Childcare can make a big difference to families, it’s easy to register – search ‘Tax-Free Childcare’ on GOV.UK.”
Overall, the HMRC have paid out £41.6 million in top-up payments, which has been shared between more than 391,000 families in the UK in June 2022.
To apply, simply search ‘Tax-Free Childcare’ on GOV.UK and complete a 20-minute registration process.
You’ll need to give your national insurance number, and unique taxpayer reference if you are self-employed.
Sally, who has undergone this process, said: “It’s very straightforward. You pay your funds into the account and then there is an automatic top up of the 20%.”
For every £8 you pay into an online account, the government add an extra £2.
To find out more, visit https://www.childcarechoices.gov.uk
In addition, for parenting advice, visit Sally’s blog: https://lifeloving.co.uk
