Tax-Free Childcare: Guidance from Childcare Choices

Tax-Free Childcare is a new government scheme to help working parents with the cost of childcare.  Enabling parents to work, or work more, if they want to.

Working parents will be able to apply to open an online childcare account, and for every £8 they pay in the government will pay in £2, up to a maximum of £2,000 of government support per child per year (or £4000 for disabled children). Parents will then be able to use the funds to pay for registered childcare.

Tax-Free Childcare will be introduced from 28 April 2017. It will be gradually rolled out starting with parents of children who are under two. Parents will be able to apply for all their children when their youngest child becomes eligible. All eligible parents will be able to apply by the end of this year.

Registered and regulated childcare providers were invited to sign up for Tax-Free Childcare in Autumn last year.  Those who had yet to sign up were sent a reminder letter earlier this year, to sign up for Tax-Free Childcare.  Signing up is a simple and quick online process. The invitation includes the childcare providers user ID which they will need to sign up.  They will also need their Unique Tax Reference (UTR).

Providers that are Limited companies are able to sign up using their corporation tax UTR. Local Authority schools can use their Local Authorities UTR to sign up, and charities that do not have, or do not know their UTR can call our contact centre who will be able to provide their existing UTR or create a new one for them. If you don’t know your UTR or don’t think you have one please call the childcare service on 0300 123 4097.

Find out more on our Business Sustainability page here or visit Childcare Choices website here.