Previously it was announced that from 6th April 2018 childcare vouchers would be closed to new entrants. However, in a House of Commons debate, the Government decided that the deadline was to be extended for a further 6months and parents therefore have until 4th October 2018 to sign up if they haven’t already done so.
To qualify, you must have signed up and received your first childcare vouchers by the deadline, so contact your payroll department as soon as possible to get the ball rolling!
How do Childcare Vouchers work?
Childcare Vouchers are an employee benefit scheme designed to help parents afford quality childcare for children aged up to 15 years old.
Most employers who offer a scheme will provide it through a salary sacrifice arrangement, whereby the vouchers are paid for from your PRE-TAX income meaning you save on tax and national insurance. It is possible to save tax & national insurance of up to £933 per year, or £1866 if both parents avail of the scheme – every little helps right?
Childcare Vouchers are also an incentive for employers as they won’t pay employers’ national insurance on the amount of vouchers you obtain.
Each parent can receive childcare vouchers, up to a certain amount, from their employer depending on their earnings:
Weekly voucher limit
Monthly voucher limit
Maximum annual tax & national insurance saving
What childcare providers are eligible to accept vouchers?
Childcare Vouchers can be used to pay for many kinds of childcare, including:
- Holiday schemes
- Before/After school care
- Nannies & au-pairs
Eligibility criteria can vary between different UK regions so it is important that appropriate advice is obtained.
As the 4th October deadline looms closer, the time to act is now!
If you wish to discuss the Childcare Voucher process further, please get in touch with the RBL team on 02895 320155, or email us at email@example.com.