Parents and guardians given extra time to claim back childcare costs with Universal Credit
The government has announced that families who claim the childcare element of Universal Credit will have an additional month to apply to be reimbursed for their childcare costs. This new change will take effect from 3 October 2019.
Under Universal Credit, eligible families can claim up to 85% of their childcare costs for children under 16 (17 for children with disabilities). Previously those claiming reimbursement had to do so in the same month-long Universal Credit assessment period in which the costs were incurred. This extension means that parents will now have more time to apply for their reimbursement.
While this extension aims to provide families with more flexibility for reporting childcare costs, parents still have to pay their childcare costs up-front. Employers For Childcare is concerned this precondition that all childcare costs must be paid in advance places a real burden on parents and is a significant barrier to work.
Universal Credit claimants must pay for childcare up-front, provide receipts, and then wait to be reimbursed after the childcare has been provided. This compares to the legacy benefits system where help with childcare costs could be claimed as it was being paid, or up to seven days before the childcare costs started.
We are calling on the Government to provide parents with up-front support for childcare costs, to make payment directly to childcare providers, and to ensure that the support helps to make childcare affordable for parents to access and for providers to deliver.
It is crucial that parents seek personalised advice on the support they are entitled to, and we would urge claimants to speak to an independent benefits advisor before moving to Universal Credit.
Further information regarding Universal Credit and childcare is available on our ‘Universal Credit’ Factsheet, or call our Family Benefits Advice Service on 0800 028 3008.