Families reminded of tax-free childcare top-ups
THOUSANDS of working families in the East Midlands could be missing out on an opportunity to get up to £2,000 a year to help with the cost of childcare, HM Revenue and Customs (HMRC) is reminding parents, ahead of February half term.
Tax-Free Childcare – the 20 per cent childcare top-up – provides eligible working families with up to £500 every three months (or £1,000 if their child is disabled) towards the cost of holiday clubs, before and after-school clubs, childminders and nurseries, and other accredited childcare schemes.
More than 25,020 working families used the scheme in September 2021, in the East Midlands. Overall, HMRC paid out more than £35 million in top-up payments, which was shared between nearly 316,000 families across the UK – an increase of about 90,000 families compared to September 2020.
Tax-Free Childcare is available for children aged up to 11, or 17 if the child has a disability. For every £8 deposited into an account, families will receive an additional £2 in government top-up.
This scheme is aimed at supporting households to raise their incomes and keep more of what they earn.
Parents and carers can check their eligibility and register for Tax-Free Childcare via GOV.UK.
Myrtle Lloyd, HMRC’s director general for customer services, said: “The 20 per cent government top-up offers working families help to pay for childcare, whether it’s nursery bills, after school clubs or holiday clubs. Search ‘Tax-Free Childcare’ on GOV.UK to find out more.”
Helen Whately, exchequer secretary to the Treasury. said: “Whether it’s for holiday clubs, breakfast clubs, or childminders and nurseries, Tax-Free Childcare is a great offer that gives working parents a helping hand with their childcare costs.”
By depositing money into their accounts, families can benefit from the 20 per cent top-up and use the money to pay for childcare costs when they need it. It is also for pre-school children attending nurseries, childminders, or other childcare providers.