Childcare Vouchers to close to new entrants on 4 October 2018
Can you afford to miss out on up to £1,866 on your annual childcare costs? If not, take action now or you could lose out…
The Childcare Voucher scheme offers working parents the opportunity to swap part of their pre-tax salary to pay for registered childcare (including breakfast and afterschool clubs, childminders, day nurseries and some holiday schemes). As a result, they make savings on their Tax and National Insurance. Two parents using the scheme can save up to £1,866 on childcare costs per year. Parents can join the scheme from when their child is born, and can pay in a nominal amount, for example £1, up to £243 per month, in order to join.
The Childcare Voucher scheme is due to close to new entrants on 4 October 2018. It’s important that anyone wishing to join the scheme does so now in order to secure these savings for their family.
Money Saving Expert Martin Lewis is currently highlighting the closure of Childcare Vouchers in his weekly email and on his website and is urging people to take action NOW if they want to sign up before the closure date – read what he has to say here.
Current users can continue to use Childcare Vouchers as long as they remain eligible, provided they do not change employer.
If you have temporarily opted out of using Childcare Vouchers, but want to have the option of using the scheme in the future, make sure you have made at least one salary sacrifice (even a nominal amount such as £1) in the 52 weeks prior to the closure date of 4 October. It is important to find out what the cut-off date is for this with your own payroll department is, it may be as soon as early September.
Remember, Childcare Vouchers can be used for children under the age of 15 (or 16 if registered disabled) – while you may not need them now, they could be a great help in the future! It can be complex working out what is best for your family and circumstances can change, for example:
- You may plan to have another child
- Your child may be moving into school or changing childcare provider
- One parent may be thinking about leaving work, reducing their hours, or taking on caring responsibilities.
If you have any questions about Childcare Vouchers or what financial help your family may be entitled to – now and in the future – call our Family Benefits Advice Service on 0800 028 3008 or email email@example.com for free, impartial and confidential advice. Last year, Employers For Childcare identified an average of £4,130 in support for working parents who received a personal benefits check from us.
We are campaigning to keep Childcare Vouchers open to new entrants permanently. Find out more about how you can support the #SaveChildcareVouchers campaign on our Lobbying page. To sign up for Childcare Vouchers or find out more from our team, get in touch here or call 028 9267 8200.
What are the benefits of Childcare Vouchers?
Childcare Vouchers operate in a similar way to online banking, meaning fast, easy payments direct to your childcare provider(s).
- Potential family savings of £1,866 a year
- Childcare Vouchers are open to both mums and dads, meaning double savings – but are available even if only one parent in the family is working
- Each parent could take up to £243 per month from their salary as Childcare Vouchers
- Can be used on all forms of registered childcare
- Fast payments direct to your childcare provider
- Available for children up to the age of 15, or 16 if registered disabled
The Childcare Voucher scheme enables employees to exchange part of their monthly salary for Childcare Vouchers. This is known as salary sacrifice and the maximum allowed is £243 per month.
The amount sacrificed is exempt from Tax and National Insurance Contributions (NIC) resulting in savings of up to £933 per annum, per employee.
|Tax and NIC applied||Maximum amount that can be sacrificed per month||Total monthly savings|
Get in touch for more information or call 0800 028 3008.
If your employer does not currently offer the Childcare Voucher scheme we would be happy to help them to set up a scheme.