Families could save thousands by using the scheme
(Image: PA)
Parents are being urged to sign up for tax-free childcare this Easter to cut the cost during the holidays. Working families can sign up for the scheme, saving up to £4,000 a year.
Once a tax-free childcare account has been opened for a child, for every £8 deposited into the account, the UK Government tops it up by £2. A family can save up to £500 every three months for each child which can be used to pay for any approved childcare.
Families that use the offer can make yearly savings of £2,000 off their childcare costs for each of their children up to the age of 11 and £4,000 for disabled children up to the age of 16. For money-saving tips, sign up to our Money newsletter here
What you can use tax-free childcare for
You can use it to pay for:
- childminders, nurseries and nannies
- after school clubs, play schemes and holiday clubs
You must use an approved childcare provider to get tax-free childcare, so your provider must be one of the following:
- a registered childminder, nanny, playscheme, nursery or club
- a childminder or nanny with a registered childminder agency or childcare agency
- a registered school
- a home care worker working for a registered home care agency
Families could be eligible for tax-free childcare if they:
- have a child or children aged 11 or under. They stop being eligible on 1 September after their 11th birthday. If their child has a disability, they receive up to £4,000 a year to help with higher childcare costs that are often involved, until 1 September after their 16th birthday
- the parent and their partner (if they have one) earn, or expect to earn, at least the National Minimum Wage or Living Wage for 16 hours a week, on average
- each earn no more than £100,000 per annum
- do not receive Universal Credit or childcare vouchers
