Thousands of working parents missing out on Tax-Free Childcare, HMRC reveals

Working parents earning up to £100,000 can claim tax relief to help with the cost of childcare, it has been reminded.

HM Revenue & Customs (HMRC) said thousands of families may be missing out on the opportunity to get up to £2,000 a year.

The Tax-Free Childcare scheme – which launched in April 2017 – provides eligible working families with up to £500 every three months for children aged 11 or under.

This increases to £1,000 every three months for children with disabilities up to the age of 17.

Getting started is easy. Simply register for a Tax-Free Childcare account and start paying in. For every £8 you deposit into this account, the Government will pay in £2.

The cash can be used to pay for a variety of approved childcare services, including childminders, nurseries and nannies, after school clubs, and play schemes.

The scheme is open to working parents who are earning at least the minimum wage for 16 hours a week, up to a maximum adjusted net income of £100,000.

Commenting on the relief, 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.”

Helen Whately, Exchequer Secretary to the Treasury, added: “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.

“I urge as many parents as possible to take advantage of this support.”

For help and advice with related matters, please get in touch with our team today.

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