HMRC offers Tax Free Childcare for school and nursery pupils
Tax-Free Childcare can be used flexibly to pay for childminders, wraparound and holiday childcare.
Hundreds of thousands of parents who recently found out their little one's September primary school place, can use Tax-Free Childcare to save thousands on wraparound childcare and holiday club costs HM Revenue and Customs (HMRC) has said.
Many working families will now be arranging childcare for the start and end of the school day, and with Tax-Free Childcare they can get financial support of up to £2,000 a year per child, or £4,000 if their child is disabled, towards the cost.
Myrtle Lloyd, HMRC's Director General for Customer Services, says: 'Starting school can be an expensive time, there's a lot to buy and there's also a lot to organise. Now you know where your child is going to school you can start organising your childcare and Tax-Free Childcare can help make the costs more manageable. Sign up to start saving today on GOV.UK.'
What is Tax-Free Childcare?
Tax-Free Childcare is a scheme that can be used to pay for any approved childcare so parents can arrange their childcare to suit them - whether that's wraparound care, a childminder, after school clubs or school holiday care.
For every £8 deposited in a Tax-Free Childcare account, the government tops it by £2 which means parents can receive up to £500 (or £1,000 if their child is disabled) every 3 months to use to pay for their childcare costs.
Parents can use the scheme to pay for childcare for children aged 11 or under, or up to 16 if the child has a disability.
It's quick and easy to apply on the HMRC website.
Who is eligible for HMRC tax-free childcare payments?
Your child must be 11 or under and usually live with you. They stop being eligible on September 1 after their 11th birthday. Adopted children are eligible, but foster children are not.
Neither parent can earn more than £100,000 a year after deductions.
If your child is disabled and usually lives with you, you may get up to £4,000 a year until 1 September after their 16th birthday. They're eligible for this if they:
get Disability Living Allowance, Personal Independence Payment, Armed Forces Independence Payment, Child Disability Payment (Scotland only) or Adult Disability Payment (Scotland only)
are certified as blind or severely sight-impaired
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What can you use tax-free childcare payments for?
HMRC says you can use it to pay for approved childcare, for example:
childminders, nurseries and nannies
after school clubs and play schemes
Your childcare provider must be signed up to the scheme before you can pay them and benefit from tax-free childcare. It's a good idea to check with your provider to see if they're signed up beforehand.
If your child is disabled, you can use the extra tax-free childcare money you get to help pay for extra hours of childcare. You can also use it to help pay your childcare provider so they can get specialist equipment for your child such as mobility aids.
Once an account is opened, parents can deposit money and use it straight away or keep it in the account to use it whenever it's needed. Any unused money in the account can be withdrawn at any time.
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You can transfer up to £1,260 of your personal allowance to your husband, wife or civil partner. Doing so reduces your tax bill by up to £252 a year. To benefit you need to be earning less than your personal allowance, which is £12,570. Meanwhile, your partner must earn less than £50,270. website. .
