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6 month extension to goverment childcare scheme

6 month extension to Government childcare voucher scheme

Education Secretary, Damian Hinds, has agreed to extend the current voucher scheme to new applicants after outcry from within Parliament and parents alike.

The voucher scheme was due to close to new applicants from April 2018 but will remain open until October 2018, allowing more parents to fund childcare from their pre-taxed salary with weekly vouchers worth up to £55.

The alternative tax-free system which is due to replace the current voucher system is already operational but it has already experienced a countless issues and faced considerable backlash. The critics fear that the alternative system will force parents to pay childcare fees up front.

Multiple schemes for childcare will also cause more work and confusion from HR, with different staff being on different schemes. HR are also advised to make sure they are advising their staff correctly so as to make the most out of the extra 6 months under the old scheme and that staff understand the financial implications of the new tax-free scheme.

The tax-free scheme will allow working parents (including those who are self-employed) to receive government top-up contributions, as long as they are earning more than £120 per week but less than £100,000 a year.

The top-up received will be 20p from the government for every 80p contributed by parents. This could amount to an extra £2,000 per child or £4,000 if the child is disabled.

If you would like any further information on the above or advice on how they apply to your business then please contact Tom Evans, Associate Employment & HR.

Tom Evans Associate

Contact Tom Evans

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