Help with Childcare Costs
Tax Free Childcare
Tax-Free Childcare is a government scheme to help working families with their childcare costs.
Parents can open an online childcare account to pay their registered childcare providers directly. For every £8 a parent pays into their account, the government will add £2. You can get up to £500 every 3 months (up to £2,000 a year) for each of your children to help with the costs of childcare.
- Your child must be 11 or under and usually live with you. They stop being eligible on 1 September after their 11th birthday.
- Adopted children are eligible, but foster children are not.
- If your child is disabled and usually lives with you, you may get up to £4,000 a year until 1 September after their 16th birthday.
You can use Tax-Free Childcare to pay for approved childcare, for example:
- childminders, nurseries and nannies
- after school clubs and play schemes
Your childcare provider must be signed up to the scheme before you can pay them and benefit from Tax-Free Childcare. Check with your provider to see if they’re signed up.
You can usually get Tax-Free childcare if you (and your partner, if you have one):
- are 16 or over
- are employed or self-employed
- earn at least National Minimum Wage and not more than £100,000 per year per person
- are not receiving Tax Credits, Universal Credit or childcare vouchers
You need to apply online by setting up a childcare account on GOV.UK:
- You can do this at the same time as applying for the 30 hours free childcare for 3 and 4-year olds
- You must reconfirm your eligibility/details every 3 months (you will receive a reminder message)
Please note, you cannot get Tax-Free Childcare at the same time as claiming Working Tax Credit, Child Tax Credit, Universal Credit or childcare vouchers.
From 28 June 2023 eligible working parents claiming Universal Credit will be able to receive more financial help with their childcare costs, and additional financial support with upfront payments when moving into paid work or increasing their working hours.
The Department for Work and Pensions (DWP) will raise the amount that parents in England can claim back monthly for their childcare costs on Universal Credit up to £951 for one child and £1,630 for two or more children. This is a rise of 47% from the previous limits.
Parents may also be able to access the funds upfront to make it easier for them to get a job or increase their hours.
Click here for more information.
Click here to apply for Universal Credit.
Which scheme you’re better off with depends on your situation. Use the childcare calculator to work out which type of support is best for you.
To see all the government schemes available to help with childcare costs, please visit: www.childcarechoices.gov.uk