New Tax Free Childcare Scheme for 2017/2018
The Government recently announced that its new Tax-Free Childcare scheme will be introduced in a phased process throughout 2017/18. To be eligible to qualify for this new scheme, which will initially only include children under 5 years, both parents have to be working. The Government propose to extend the age limit to include children under 12 years within the first twelve months.  Once the new Tax-Free Childcare scheme is introduced parents will not have the option of joining the current Childcare voucher scheme.The current Childcare Vouchers scheme was set to close to new registrants on 5th April 2018. However, on March 13th the Education Secretary announced the decision to extend the Childcare Voucher scheme for a further six months. The date by which parents must register for the existing scheme has not yet been confirmed but it is thought that the deadline date will be sometime in October 2018. Parents who are signed up for Childcare Vouchers before this new deadline will have the choice of either continuing to take childcare vouchers or switch to the new scheme if they wish (subject to staying with the same employer and not taking an unpaid career break of longer than a year). Take a look at the current scheme versus the new scheme (see our Guide to Which Scheme) and see which scheme suits you best. Don’t miss out on the chance of registering for Childcare Vouchers.

What are Childcare Vouchers...?  
In April 2005, The Government introduced a Childcare Voucher Scheme to help support working parents. The scheme means that companies can offer employees childcare vouchers as part of their salary Free of Tax and National Insurance. Childcare Vouchers are a simple, flexible and effective way for employers to help their employees with their childcare costs. Companies can give employees up to £2,916 per year tax free in childcare vouchers saving your company 13.8% Employers National Insurance Contribution on this figure and saving parents up to £933 each in Tax and National Insurance.  Employers can save up to £402 per employee per year in NI contributions. The scheme also improves staff morale, employee retention and recruitment of new staff. Read More  

Savings Illustration  

Basic Rate Tax Payer

Max Allowance: £243/month

Max Annual Saving: £933

Higher Rate Tax Payer

Max Allowance: £124/month

Max Annual Saving: £625

Additional Rate Tax Payer

Max Allowance: £110/month

Max Annual Saving: £620