Tax-free Childcare officially opens to all parents with children under 12 - how to apply

Under the scheme's rules, working families could receive up to £2,000 a year towards the cost of their childcare who have children up to the age of 12.

The Government says it will help thousands of families throughout the UK with the price of looking after their children. It says it can pay for after school and holiday clubs for older children, as well as nurseries and playgroups for younger ones including ACE Learning :)

The Tax-Free Childcare Scheme was launched last April for the youngest children, but as of today, it’s now on offer to all the families covered by the scheme.

It can be used by anyone who is working, whether employed or self-employed and replaces employer-supported childcare, including childcare vouchers, which were only available through some employers.

Here’s what you need to know to sign up:

WHAT DOES THE SCHEME OFFER?

The new system will see the government contribute 20p for every 80p that parents spend on care costs.

This is the equivalent of the 20% tax many people pay on their earnings - hence the name ‘tax-free’.

You pay into a special account, and the money in that is used to pay for your childcare. The maximum Government contribution is £2,000 a year for children up to the age of 12, or £4,000 a year for a disabled child up to the age of 17.

How much you pay into the account, and when, is up to you, and you can use it more at certain times of the year if you need to, for example, over the school holidays.

WHO IS ELIGIBLE?

You can apply for the scheme if

✔        your child is less than 12 years old, or

✔        if they are less than 17 and receiving Disability Living Allowance, a Personal Independence Payment or an Armed Forces Independence Payment or

✔        if they’re up to 17 if your child is severely sight-impaired or blind.

The parent or parents using the scheme must be working.

They should expect to earn at least £120 per week if they’re over 25, or if they’re under 24 or an apprentice, you should earn the equivalent of at least 16 hours of work per week at the national minimum wage rate for their age.

Self-employed people with a registered business can also apply.

Households, where one parent earns more than £100,000, cannot take part in the scheme.

While both parents must be working to qualify, those temporarily absent from the workplace such as those on paid or unpaid maternity, paternity or adoption leave will still be eligible.

WHAT CAN I SPEND THE MONEY ON?

Money can be used to pay for up to 10 childcare providers.

It can pay for:

✔       Childcare with regulated (approved or registered) childcare providers including ACE Learning and nurseries, play scheme, registered childminders or out-of-hours school clubs.

✔       Advance payments, block bookings and individual sessions.

✔       The costs of employing a nanny or extra childcare if using a workplace nursery.

CAN IT BE USED FOR MORE THAN ONE CHILD?

Yes, although each child should have an individual account. You can apply for multiple accounts in one application.

HOW DO I APPLY?

To apply, you’ll need your national insurance number and passport or driving licence.

You’ll need to reconfirm your eligibility every three months.

You’ll be able to apply online, using the Government website at https://www.childcarechoices.gov.uk/

QUESTION: Can I get my money back if I no longer want to use the scheme?

Yes, you can take your money back out of the account - but you won’t get the bonus you’ve built up.