Don’t miss out on up to £2k towards childcare costs

Tax-Free Childcare – the 20 per cent childcare top-up – provides eligible working families with up to £500 every three months (or £1,000 if their child is disabled) towards the cost of holiday clubs, before and after-school clubs, childminders and nurseries, and other accredited childcare schemes.

Nearly 316,000 working families used Tax-Free Childcare across the UK in September 2021, receiving a share of £35 million in government top-up payments towards their childcare costs – an increase of about 90,000 families compared to September 2020.

Tax-Free Childcare is available for children aged up to 11, or 17 if the child has a disability. For every £8 deposited into an account, families will receive an additional £2 in government top-up.

This scheme is one of many ways the government is supporting households to raise their incomes and keep more of what they earn.

Parents and carers can check their eligibility and register for Tax-Free Childcare via GOV.UK.

Myrtle Lloyd, HMRC’s director general for customer services, said the 20 per cent government top-up offers working families help to pay for childcare, whether it’s nursery bills, after-school clubs or holiday clubs. Search “Tax-Free Childcare” on GOV.UK to find out more.

By depositing money into their accounts, families can benefit from the 20 per cent top-up and use the money to pay for childcare costs when they need it. Accounts can be opened at any time of the year and can be used straight away.

For example, if parents and carers have school-aged children and use holiday clubs during school holidays, they could deposit money into their accounts throughout the year. This means they could spread the cost of childcare while also benefiting from the 20 per cent government top-up.

Tax-Free Childcare is also available for preschool-aged children attending nurseries, childminders, or other childcare providers. Families with younger children will often have higher childcare costs than families with older children, so the tax-free savings can really make a difference.

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