Get help with summer holiday childcare costs

HM Revenue and Customs (HMRC) reminds thousands of parents and families not to miss out on financial support that can help pay for child care during the summer holidays.

Through Tax-Free Childcare, families can receive up to £ 2,000 a year per child – or £ 4,000 if their child is disabled – to cover the cost of childcare. And it is available for children up to 11, or 17 if the child has a disability. The money can help cover the costs of holiday clubs, pre- and post-school clubs, childminders and nurseries and other approved childcare schemes.

The government will pay 20% of childcare costs by supplementing the money paid into a Tax-Free Childcare Account. This means that for every £ 8 paid into the online account, families will automatically receive an additional £ 2 in government supplement.

More than 384,280 families used tax-free childcare in March 2022 – the highest number of families using the scheme since it was launched in April 2017 – but thousands more may be missing out. Research published earlier this year by HMRC It is estimated that some 1.3 million families may be eligible for this government support.

Myrtle Lloyd, HMRC‘s Director-General for Customer Services, said:

Tax-free childcare can make a big difference to families by helping with bills for things like vacation clubs, nurseries, babysitters and after-school clubs. It’s easy to register – search for ‘Tax-Free Childcare’ on GOV.UK.

Helen Whately, HM Treasury’s Treasury Secretary of the Treasury, said:

Tax-free childcare helps families with the cost of childcare bills, but we know thousands of parents can miss it.

That’s why I encourage families to sign up now and save on childcare costs.

There are many fantastic holiday clubs and childcare providers to help working parents during the upcoming summer holidays, so now is the time to take advantage of this support.

For thousands of families who use tax-free childcare, the money they save each month on their childcare costs is money that goes back into their pockets. Accounts can be opened at any time of the year and can be used immediately, and money can be deposited and used at any time when needed. Any unused money deposited can be easily withdrawn at any time.

Caroline from Portsmouth uses Tax-Free Childcare to help pay for her children’s after-school and holiday clubs and explains why she uses them. Caroline said:

I am a busy working mother with 2 children and I find Tax Free Childcare is easy and simple to use. I go to the system every month and set the amount I have to pay to my child care provider. The financial support definitely helps, but I also like the flexibility and how Tax-Free Childcare helps me budget for my childcare costs.

With the school’s summer holidays approaching, it’s more important than ever for parents and carers to have access to the financial aid they qualify for. It can reduce their costs, help them stay at work, or help them work more hours.

More than one million families in the UK are entitled to some form of state support for childcare and the government encourages those who are eligible not to miss out on their claims. Families can find out which childcare support is best for them via Childcare Choices.

To ensure that parents receive the childcare support to which they are entitled, the government is launching an awareness advertising campaign this week.

Further information

For more information on Tax-Free Child Care and how to register.

Parents and caregivers may be eligible for Tax-Free Child Care if they:

  • have a child or children up to 11. They cease to be eligible on September 1 after their 11th birthday. If their child has a disability, they can get up to £ 4,000 a year until they are 17
  • earn, or expect to earn, at least the National Minimum Wage or Living Wage for an average of 16 hours per week
  • each earns less than £ 100,000 a year
  • does not receive tax credits, universal credit or childcare vouchers

Latest tax-free childcare statistics were released on May 25, 2022. Data are available until March 2022.

HMRC has compiled a revamped Tax-Free Child Care Guide for Parents, which explains the reasons and benefits of joining the scheme.

Every qualifying child needs their own tax-free childcare account. If families have more than one suitable child, they will have to register an account for each child. The 20% government supplement is then applied to deposits made for each child, not household.

Account holders must confirm every three months that their details are up to date to continue receiving the government supplement.

Childcare providers can also sign up for a childcare provider account via GOV.UK to receive payments from parents and caregivers via the scheme.

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