Families receive up to £500 every three months (£2,000 a year) per child, or £1,000 (£4,000 a year) if their child is disabled, helping towards the cost of before and after-school clubs, childminders and nurseries, holiday clubs and other approved childcare schemes.
In June 2022, more than 23,200 working families in Scotland benefitted from Tax-Free Childcare – but thousands more could be missing out. Overall in June, HMRC paid out £41.6 million in top-up payments, which was shared between approximately 391,000 families across the UK.
Myrtle Lloyd, HMRC’s Director General for Customer Services, said:“Tax-Free Childcare can make a big difference to families in Scotland, helping with the bills for things like wraparound care for school children, nurseries, childminders and holiday clubs. It’s easy to register – search ‘Tax-Free Childcare’ on GOV.UK.”
More than one million families in the UK are entitled to some form of UK Government childcare support and the government is encouraging those eligible to not miss out on their entitlements.
For thousands of families who use Tax-Free Childcare, the money they save each month on their childcare costs is money that goes back into their pockets.
Accounts can be opened at any time of the year and can be used straight away, and money can be deposited at any time and used when needed.
Any unused money that is deposited can be simply withdrawn at any time.
New Tax-Free Childcare statistics from HM Revenue and Customs (HMRC) have revealed that 29,110 families in Scotland received up to £2,000 towards the cost of their childcare during the 2021 to 2022 tax year, up from 20,330 in the previous year.
Tax-Free Childcare provides thousands of eligible working families with vital financial support towards the cost of their childcare with the government paying £240 million annually in top-up payments to families using the scheme.
For thousands of families who use Tax-Free Childcare, the money they save each month on their childcare costs is money that goes back into their pockets.
For every £8 paid into a Tax-Free Childcare online account, families will automatically receive an additional £2 in government top-up, and it is available for children aged up to 11, or 17 if the child has a disability.
Families receive up to £500 every three months, per child, or £1,000 if their child is disabled, helping towards the cost of before and after-school clubs, childminders and nurseries, holiday clubs and other approved childcare schemes.
But hundreds of thousands of families could be missing out, with recent research published by HMRC estimating that about 1.3 million families could be eligible for this government support. Parents and carers are being urged to check their eligibility and register for Tax-Free Childcare via GOV.UK.
Across the UK, 512,415 families used Tax-Free Childcare in the 2021 to 2022 tax year, compared to 374,135 in the 2020 to 2021 tax year.
Myrtle Lloyd, HMRC’s Director General for Customer Services, said: “Tax-Free Childcare can make a big difference to families, helping with the bills for things like nurseries, childminders and after school clubs. It’s easy to register – search ‘Tax-Free Childcare’ on GOV.UK.”
Helen Whately, HM Treasury’s Exchequer Secretary to the Treasury, said: “It’s fantastic that more parents are taking up Tax-Free Childcare. This support provides a helping hand with childcare costs for working families.
“With over one million families eligible, I want to encourage parents to take advantage of Tax-Free Childcare and keep the extra pounds in their pocket.”
The latest monthly comparisons for Scotland also show that a record number of families were using their Tax-Free Childcare account in March 2022 – 22,710 families compared to 15,240 in March 2021 – an increase of 7,470 families.
The scheme offers a 20% government funded top-up on money deposited into Tax-Free Childcare accounts, which can be used to pay their childcare provider. Accounts can be opened at any time of the year and can be used straight away, and money can be deposited at any time and used when needed.
For example, if parents and carers have school-aged children and use holiday clubs during school holidays, they could deposit money into their accounts throughout the year. This means they could spread the cost of childcare while also benefitting from the 20% government top-up. Any unused money that is deposited can be simply withdrawn at any time.
Tax-Free Childcare is also available for pre-school aged children attending nurseries, childminders, or other childcare providers. Families with younger children will often have higher childcare costs than families with older children, so the tax-free savings can really make a difference.
Customers in Scotland are being encouraged to check online for the range of financial support available from HM Revenue and Customs (HMRC) to help with living costs.
HMRC has listed the support available in one place to ensure people are not missing out and can easily find out online if they are eligible and how to claim.
The new GOV.UK page pinpoints people to a one-stop shop of all the benefits, credits and allowances available to individuals and families, making it easier than ever for people to claim what they are entitled to.
This includes:
Child Benefit
Child Benefit can be claimed if someone is responsible for bringing up a child who is:
under 16
under 20 if they stay in approved education or training
Only one person can get Child Benefit for a child. It’s paid every 4 weeks and there’s no limit to how many children you can claim for.
Tax-Free Childcare
Working parents can get assistance of up to £500 every 3 months (up to £2,000 a year) for each of their children to help with the costs of childcare until the September after their 11th birthday. If a child is disabled, this goes up to £1,000 every 3 months until the September after their 16th birthday (up to £4,000 a year).
Marriage Allowance
Marriage Allowance allows individuals to transfer 10% (£1,260) of their personal tax allowance to a husband, wife or civil partner if they earn less than the personal tax allowance, which is usually £12,570.
Work-related expenses and uniform allowances
Tax relief can be claimed on money spent on things like work uniform and clothing, tools, subscriptions or business travel.
The GOV.UK page also includes guidance for those on a low income wanting to make the most of their savings and help for those struggling to pay their tax bill.
Myrtle Lloyd, Director General Customer Services Group, HMRC: “We understand these are very difficult times for many so it’s vitally important we continue to highlight the range of support available.
“We’d encourage those who think they may be eligible for support to take a look and claim what they’re entitled to – it could make an important difference to household budgets at a time when it’s needed the most.”
Additional online tools and guidance are available to help customers check if they are eligible for each service – as well as extra support to guide them through the application process.
Thousands of working families in Scotland could be missing out on an opportunity to get up to £2,000 a year to help with the cost of childcare, HM Revenue and Customs (HMRC) is reminding parents ahead of the February mid-term break.
Tax-Free Childcare – the 20% childcare top-up – provides eligible working families with up to £500 every three months (or £1,000 if their child is disabled) towards the cost of holiday clubs, before and after-school clubs, childminders and nurseries, and other accredited childcare schemes.
More than 18,500 working families used Tax-Free Childcare across Scotland in September 2021, receiving a share of £35 million in UK Government top-up payments towards their childcare costs – an increase of about 90,000 families compared to September 2020.
Tax-Free Childcare is available for children aged up to 11, or 17 if the child has a disability. For every £8 deposited into an account, families will receive an additional £2 in government top-up.
This scheme is one of many ways the UK Government is supporting households to raise their incomes and keep more of what they earn.
Myrtle Lloyd, HMRC’s Director General for Customer Services, said: “The 20% government top-up offers working families help to pay for childcare, whether it’s nursery bills, after school clubs or holiday clubs.
“Search ‘Tax-Free Childcare’ on GOV.UK to find out more.”
Helen Whately, Exchequer Secretary to the Treasury said: “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.
“This UK Government is committed to supporting working families which is why it’s fantastic that thousands more are saving money through the Tax-Free Childcare scheme. I urge as many parents as possible to take advantage of this support.”
By depositing money into their accounts, families can benefit from the 20% top-up and use the money to pay for childcare costs when they need it. Accounts can be opened at any time of the year and can be used straight away.
For example, if parents and carers have school-aged children and use holiday clubs during school holidays, they could deposit money into their accounts throughout the year. This means they could spread the cost of childcare while also benefitting from the 20% government top-up.
Tax-Free Childcare is also available for pre-school aged children attending nurseries, childminders, or other childcare providers. Families with younger children will often have higher childcare costs than families with older children, so the tax-free savings can really make a difference.
Families in Scotland may be eligible for Tax-Free Childcare to help pay for breakfast and after school clubs as children go back to school.
Families are eligible to save money on their childcare and benefit from a government top-up worth up to £2,000 every year, or up to £4,000 a year if a child is disabled. In June 2021, about 17,530 families in Scotland benefited from using Tax-Free Childcare, but thousands are missing out on this opportunity.
Tax-Free Childcare is available to eligible parents or carers who have children aged up to 11, or 17 if their child is disabled. For every £8 a parent or carer deposits into their account, they will receive a £2 top-up, up to the value of £500 every three months, or £1,000 if their child is disabled. Parents and carers can check their eligibility and register for Tax-Free Childcare via GOV.UK.
HMRC recognises that families’ personal circumstances have changed since March 2020 as more parents and carers are preparing to return to their workplaces. The 20% top-up is paid into the child’s Tax-Free Childcare account and is ready to use almost instantly, meaning parents and carers can use the money towards the cost of childminders, breakfast and after school clubs, and approved play schemes.
Myrtle Lloyd, HMRC’s Director General for Customer Services, said: “As your children head back to school this autumn, don’t miss out on the opportunity to receive your 20% top-up to help pay for their childcare.
“It is quick and easy to sign-up, just search ‘tax-free childcare’ on GOV.UK.”
Tax-Free Childcare is also available for pre-school aged children attending nurseries, childminders or other accredited childcare providers. Parents and carers, who are returning to work after parental leave, can apply for a Tax-Free Childcare account for that child before they need to start using it. Families can start depositing money 31 days before they return to work, maximising the potential government top-up saving.
Tax-Free Childcare – a childcare top-up for working parents – can be used to help pay for accredited holiday clubs, childminders or sports activities – giving parents and carers that extra peace of mind that their child is having fun during the school summer holidays and it can save them money.
Tax-Free Childcare is available for children aged up to 11, or 17 if the child has a disability. And for every £8 deposited into an account, families will receive an additional £2 in UK Government top-up, capped at £500 every three months, or £1,000 if the child is disabled.
Parents and carers can check their eligibility and register for Tax-Free Childcare via GOV.UK. They can apply for an account at any time and start using it straight away. By depositing money into their accounts, families can benefit from the 20% top-up and use the money to pay for childcare costs when they need to, for example, during the summer holidays.
Myrtle Lloyd, HMRC’s Director General for Customer Services, said: “We want to help kids stay active this summer, whether they are going to summer holiday clubs or a childminder.
“A childcare top-up will go a long way towards helping parents plan and pay for summer activities to keep their kids happy and healthy. To find out more search ‘tax-free childcare’ on GOV.UK.”
Iain Stewart, UK Government Minister for Scotland, said: “There can be a lot of pressure on working parents to find suitable childcare during school holidays but the UK Government’s Tax-Free Childcare scheme gives a massive helping hand.
“It helps parents ensure their children are in a safe environment where they’ll have fun and be well looked after, and it saves money at the same time. The Scottish school holidays are almost upon us and I’d urge all eligible parents to apply.”
15,240 working families used their account in March 2021 in Scotland. And in the same month, HMRC paid out more than £33 million in top-up payments, which was shared between more than 282,000 families across the UK.
Tax-Free Childcare is also available for pre-school aged children attending nurseries, childminders or other childcare providers. Families with younger children will often have higher childcare costs than families with older children, so the tax-free savings can really make a difference.
As schools return in Scotland, HM Revenue and Customs (HMRC) is reminding working parents they could save up to £2,000 per child per year to pay towards after-school clubs and other childcare services.
Around 110,000 families in Scotland are eligible for Tax-Free Childcare, which can cut thousands of pounds off childcare bills.
All families have to do is pay into their Tax-Free Childcare account and for every £8 that they deposit, the UK Government immediately makes a top-up payment of an additional £2.
The scheme is open to working parents, including the self-employed, who earn between the minimum wage and £100,000 per year and have children aged 0-11 years old. Families with a disabled child, aged 0-17 years old, can receive up to £4,000 in government support each year.
Families in Scotland can choose from childcare providers that have signed up to Tax-Free Childcare, including nannies, nurseries, childminders or after-school clubs.
HMRC’s Deputy Chief Executive and Second Permanent Secretary, Angela MacDonald, said: “As more parents across the country return to work and kids head back to school following the outbreak of the Coronavirus pandemic, there has never been a better time to sign up to Tax-Free Childcare.
“It takes just minutes to set up an account on our Childcare Choices website and soon you could be receiving up to £2,000 per child towards the cost of childcare each year.”
UK Government Minister for Scotland, Iain Stewart, said: “Tens of thousands of families in Scotland are eligible to access savings towards after-school clubs and other childcare services thanks to the UK Government’s Tax-Free Childcare scheme.
“As more parents return to work and children to Scotland’s schools following the arrival of the COVID-19 pandemic, I urge people to make full use of the support. The scheme is part of a significant package of measures that the UK Government has in place to help families in Scotland.”
You can find out more and apply through the Childcare Choices website. It includes a Childcare Calculator that compares all the government’s childcare offers to check what works best for individual families.
Tax-Free Childcare is just one example of the support available to families in Scotland from the UK Government. More information on other schemes such as Help To Save and Marriage Allowance can be found on the Delivering for Scotland website.
How Tax-Free Childcare works:
Working parents can apply, through the childcare service, to open an online childcare account. The scheme is available for children under the age of 12, or under the age of 17 for children with disabilities.
If you or your partner have an ‘adjusted net income’ over £100,000 in the current tax year, you will not be eligible. This includes any bonuses you expect to get.
For every £8 that families pay in, the UK Government will make a top-up payment of an additional £2, up to a maximum of £2,000 per child per year (or £4,000 for disabled children). This top-up is added instantly and parents can then send payments directly to their childcare providers. The maximum government top-up is £500 per quarter for each child, or £1,000 if the child is disabled.
All registered childcare providers – whether nannies, nurseries, childminders or after-school clubs – can sign up online to receive parents’ payments through Tax-Free Childcare.
Parents need to sign back in every three months and confirm their details are up-to-date, to keep getting government top-ups.
Families who were already signed up to Tax-Free Childcare but have fallen below the minimum income requirement due to COVID-19 will continue to receive financial support until 31 October. Critical workers who may exceed the income threshold for the 2020-21 tax year due to working more to tackle the pandemic, will continue to receive support this tax year. More information.
