The introduction of the governements tax-free childcare on 28th April 2017 and the impact for employees and employers versus the Childcare Voucher system has been causing a lot of confusion. Employees Matter is working with an independent financial advisor who will be hosting seminars and webinars on these changes. Make sure your staff are fully informed. We’re here to help.
The main points:
- Tax-Free Childcare will be introduced on 28 April 2017 and will then be gradually rolled out over 2017, with parents of children under two invited to enter the scheme first
- Tax-Free Childcare is a new government scheme to help working parents with the cost of childcare.
- Parents will be able to open an online account, which they can use to pay for childcare from a registered provider.
- 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.
- The scheme will be available for children under the age of 12, or under 17 for children with disabilities.
- To qualify, parents will have to be in work, and each expecting to earn at least £120 a week. Each parent must not have income over £100,000 per year.
- Cannot join if claiming Child Tax Credits, Universal Credit, or Childcare Vouchers.
- Self-employed parents can join.
But what about Childcare Vouchers:
- The Childcare Vouchers scheme (also known as ‘Employer Supported Childcare’) will remain open to new joiners until April 2018. Anyone already a member of this scheme by this date can continue to stay on it for as long as they need to, or until they change employer.
- Can be used for children up to 15 years old, or 16 if registered disabled.
- One or both parents can join if they are employed, and their employer has a scheme in place.
- The parent must still earn above the national minimum wage once salary has been reduced.
- There is no income limit.
- Can be used at the same time as claiming Child Tax Credits or Universal Credit.
- Self-employed parents cannot join.
Get in touch to help your staff make the right decision for them.