The revised government tax-free childcare scheme is being fine tuned
Details of the government tax-free revised childcare scheme is being fine tuned by Government. This scheme will help working parents with the cost of childcare, it is expected to be launched in early 2017.
Parents will be able to open an online account and use this to pay for childcare; it can only be paid to a registered Ofsted provider.
New employees are still able to claim tax-free childcare through their employer’s scheme; this will only remain open to new entrants until April 2018. Parents who are enrolled on this scheme will be able to stay on this scheme until their employers offer it.
The new government tax-free scheme will be available to more working parents compared to the employer’s supported childcare, self-employed parents will also be able to get help with childcare when using the government tax-free scheme.
How the government tax-free scheme will work:
Every 80p that parents contribute the government with pay in 20p. The scheme will allow parents to receive £2000 per year, per child towards help with childcare, the amount for disabled children doubles to £4000.
To be eligible for this Government tax-free scheme parents must be in work and earning a minimum of £115 per week and earn no more than £100,000 per year.
Providers will be receiving letters inviting them to register online. Once providers are registered they will appear on HMRC’S new digital tool, giving parents the ability to search for childcare providers that are offering the new scheme.