V4B Business Finance

School holidays – how are you paying for childcare?

Children in primary school

As the summer holidays approach many working parents are dreading the thought of paying for an additional six weeks’ childcare during the break.

Almost a third of parents in Great Britain (31%) feel stressed trying to arrange childcare for the school holidays according to a new YouGov poll out today.

The poll for HM Revenue and Customs (HMRC) also found that around a third of British parents (30%) worried about balancing their job and school holiday childcare. And more than half (54%) admitted they look forward to their children returning to school in September.

Working parents are being reminded that they can use Tax-Free Childcare (TFC), which is worth up to £2,000 per child per year, to pay for regulated holiday clubs during the school holidays.

Chief Secretary to the Treasury, Liz Truss, said: ‘Organising childcare for school holidays is important for parents. TFC and 30 hours free childcare help make things easier by cutting thousands of pounds from the childcare bills of working parents.

‘So I hope families across the country visit the Childcare Choices website to take advantage of the offer available from the Government, and enjoy the holidays.’

More than 58,000 registered childcare providers including school, football, art and tennis clubs have signed up across the UK. Parents that pay into their account regularly can ‘save up’ their TFC allowance and use it for childcare during school holidays. The money can go towards a whole range of regulated childcare including nurseries, childminders, before and after school clubs, or holiday clubs.

Parents can apply for TFC and 30 hours free childcare at the same time and are encouraged to do so before the end of June in time for next term. They can then both be used together, with TFC payments applying to any additional childcare costs over and above the 30 hours support, throughout the year. Both offers are available to self-employed parents.

Children and Families Minister, Nadhim Zahawi, added: ‘We are spending more than any other government on childcare because we want every child to get the best start in life.

‘We are supporting as many families as possible with access to high-quality, affordable childcare helping to put more money in their pockets and balancing work and family lives.’

Parents can find out what government help is available and apply online by visiting the Childcare Choices website. It includes a Childcare Calculator that compares all the government’s childcare offers to check what works best for individual families.

How TFC works:

  • Working parents can apply, through the childcare service, to open an online childcare account. For every £8 that families pay in, the government will make a top-up payment of an additional £2, up to a maximum of £2,000 per child per year (or £4,000 for disabled children). This top up is added instantly and parents can then send electronic payments directly to their childcare providers. The maximum government top-up is £500 per quarter for each child, or £1,000 if the child is disabled.
  • All registered childcare providers – whether nannies, nurseries, childminders or after school clubs – can sign up online now to receive parents’ payments through TFC.
  • Parents need to sign back in every three months and confirm their details are up to date, to keep getting government top-ups.
  • TFC is replacing ‘childcare vouchers’, which is only available to parents if their employer offers it. Employer-Supported Childcare will be closing to new entrants on 4 October 2018, but parents who are already a member of a scheme will be able to remain in it if they remain with their employer and their employer continues to offer it. The tax and National Insurance exemption for workplace nurseries will remain in place. Parents moving from Employer-Supported Childcare to TFC can still use childcare vouchers they’ve previously accrued.

 

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