Tax-free childcare

This year the government will introduce Tax-Free Childcare, a new UK-wide scheme to help working parents pay for childcare.

What is Tax-Free Childcare?

Parents will be able to open an online childcare account, which they will use to pay for their childcare directly. For every £8 a parent pays in, the government will pay in an extra £2. Parents can receive up to £2,000 per child, per year, towards their childcare costs, or £4,000 for disabled children - separate from funded entitlements.

The offer will be available for children up to the age of 12, or 17 for children who are disabled. To qualify, both parents will have to be in work, and each expecting to earn at least £125 a week - and not more than £100,000 each year.

Tax-Free Childcare can be used to pay for:

  • Pre schools
  • Registered childminders
  • Day nurseries
  • School-based care (that is paid for, such as after-school clubs)
  • Out of school or holiday clubs

Parents can’t claim Tax-Free Childcare at the same time as claiming tax credits, Universal Credit or childcare vouchers. Childcare providers can receive payments from both Tax-Free Childcare and childcare vouchers.

Apply for Tax-Free Childcare

You’ll need your details (and your partner’s, if you have one), including your:

  • National Insurance number
  • Unique Taxpayer Reference (UTR), if you’re self-employed

It takes 20 minutes to apply.

As part of your application, you’ll find out if you’re eligible for both Tax-Free Childcare and 30 hours free childcare. You may find out straight away, but it can take up to 7 days.

If you have applied for Tax-Free childcare and have an eligibility code, you will need to reconfirm it every three months.

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