Tax – Free Childcare
Tax-free childcare is a Government – backed scheme which helps parents with the cost of childcare. The scheme, which launched April in 2017, gives eligible families 20% financial support towards the childcare costs. It is replacing the childcare vouchers scheme.
The scheme is designed so that for every 80p you pay towards the childcare cost, HMRC will pay 20p per child, so this means you effectively get back the equivalent to a basic-rate tax or 20% back on what you pay.
For example, if your weekly childcare cost is £40 the government will pay 20% of it (which is £8), while you are paying £32 per week. This is a typical example of our weekly charge per child at Focus Tuition Ltd.
The Tax-Free Childcare is available for families earning up to £100,000 per annum.
Working Tax Credit and Universal Credit
You may qualify for Working Tax Credit to help pay for up to 70% of your childcare costs whilst you are working. This is if you are eligible for Working Tax Credit.
Who is eligible for Tax-Free Childcare?
To qualify for the Tax-Free Childcare you and your partner should be working for a minimum of 16 hours per week, each earning at least the National Minimum Wage or Living Wage, and are 25 or over. The work can be gained employment or self-employed. You are also eligible if you are a working single parent. However, if you work and your partner does not, you will not be qualified for Tax – free childcare.
Your child must be 11 or under and living in your household. They stop being eligible on 1st September, after their 11th birthday. Unless your child is disabled, the scheme will be available to them until they turn 17.
Focus Tuition Ltd is a registered childcare centre and signed for the Tax-Free Childcare scheme. If you are a working parent with a household earning of less than £100,000, you can save 20% of the childcare cost you would be paying to us.
