Tax-Free Childcare is a new government scheme that will be available to eligible parents to help with their childcare costs. Parents will open one Tax-free Childcare online account for each of their children and put money into these accounts.
The government will top up the account with a 20% contribution and then you will pay your nanny straight from these accounts into the nanny’s bank account. For every £8 you pay in, the government will pay in £2. The maximum government contribution per child, per year is £2,000, or £4,000 per year for disabled children.
Who is eligible?
Both parents must be employed, or the single parent in single-parent families and each earn at least £115 a week and no more than £100,000 each per year. The children must be under 12, or under 17 for disabled children. Nannies must be registered with Ofsted and must be signed up to Tax-Free Childcare. If you wish to check whether you are eligible, please click here
When will this happen?
The scheme will be rolled out to parents gradually over 2017, starting with the parents of the youngest children. So parents with babies will be first, even if they have older children as well, they will be able to claim for all of their children at once.