Tax-Free Childcare
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1. What Tax-Free Childcare is
Tax-Free Childcare can help with the cost of paying for childcare.
You’ll need to set up a childcare account, which both you and the government will pay into. You can then use this money to pay your childcare provider.
For every £8 you pay into the account, the government will top it up by £2.
The total top up you can get for each child is £500 every 3 months (up to £2,000 a year). This goes up to £1,000 every 3 months if your child is disabled (up to £4,000 a year).
You’ll usually need to be working (or returning to work) and your child must be 11 or younger (16 or younger if they’re disabled).
Your childcare provider must be signed up to the Tax-Free Childcare scheme. Before you apply, you’ll need to check with your provider that they’re already signed up.
This guide is also available in Welsh (Cymraeg).
If you already get Tax-Free Childcare
You can sign in to your childcare account to confirm your details are up to date and pay your childcare provider.
What you can use Tax-Free Childcare for
You can use it to pay for:
- childminders, nurseries and nannies
- after school clubs, play schemes and holiday clubs
You must use an ‘approved childcare’ provider to get Tax-Free childcare, so your provider must be one of the following:
- a registered childminder, nanny, playscheme, nursery or club
- a childminder or nanny with a registered childminder agency or childcare agency
- a registered school
- a home care worker working for a registered home care agency
Check if your childcare provider is registered.
If your child is disabled
You can use the extra money you get to help pay for more hours of childcare.
You can also use it to help pay your childcare provider so they can get specialist equipment for your child, such as mobility aids.
Talk to them about what equipment your child can get.
If your childcare provider is in an EEA country
You may be able to use Tax-Free Childcare to pay a provider based in a European Economic Area (EEA) country. Contact HM Revenue and Customs (HMRC) to check.
How it works
Once you have a childcare account, you can pay money into your account by Direct Debit, standing order or bank transfer.
Your payment will usually appear in your childcare account within one working day. The government’s payment is added at the same time. You can then pay your childcare provider.
You must sign in to your childcare account every 3 months to confirm you’re still eligible. If you do not, your Tax-Free Childcare will stop.
Example
Your childcare bill is £250.
You pay £200 into your childcare account (80% of the bill). The government adds £50 (20% of the bill). You can then use the £250 to pay your childcare provider.
2. Check if you're eligible
Whether you can get Tax-Free Childcare depends on:
- your child’s age and circumstances
- if you’re working
- your income (and your partner’s income, if you have one)
- your immigration status
You cannot claim if any of the following are true:
- your child does not usually live with you
- you foster the child you’re applying for
- you or your partner’s expected adjusted net income (including any foreign income) is over £100,000 for the current tax year
- you or your partner get a childcare bursary or grant
If you claim either Universal Credit or childcare vouchers, you cannot get Tax-Free Childcare at the same time. Find out what to do before claiming Tax-Free Childcare.
Your child’s age and circumstances
Your child is eligible until the September after they turn 11.
If your child is disabled
They’re eligible until the September after they turn 16.
They must be certified as blind or severely sight-impaired or get any of the following:
- Disability Living Allowance
- Personal Independence Payment
- Armed Forces Independence Payment
- Child Disability Payment (Scotland only)
- Adult Disability Payment (Scotland only)
If you’re working
You can usually get Tax-Free Childcare if you (and your partner, if you have one) are:
- in work - you can be employed or self-employed
- on sick leave or annual leave
If you’re on maternity, paternity, shared parental or adoption leave
You can usually get Tax-Free Childcare. Check when you need to apply.
If you’re not working at the moment
You may still be eligible if your partner is working and you get any of the following:
- Incapacity Benefit
- Severe Disablement Allowance
- Carer’s Allowance or (in Scotland only) Carer Support Payment
- contribution-based Employment and Support Allowance
If you’re starting or re-starting work
You can usually get Tax-Free Childcare. Check when you need to apply.
Your income
You (and your partner, if you have one) must each expect, over the next 3 months, to earn at least:
- £2,643.68 before tax if you’re aged 21 or over (the same as £203.36 per week)
- £2,256.80 before tax if you’re aged 18 to 20 (the same as £173.60 per week)
- £1,664 before tax if you’re under 18 or an apprentice (the same as £128 per week)
This is the National Minimum Wage or Living Wage for 16 hours a week on average.
You can use an average of how much you expect to earn over the current tax year if:
- you work throughout the year but do not get paid regularly
- you’re self-employed and do not expect to earn enough in the next 3 months
Example
You’re eligible if you’re 21 or over and do not have a regular income but earn £10,574.72 a year. This is the same as earning £2,643.68 every 3 months on average.
If you’re self-employed
If you started your business less than 12 months ago, it does not matter how little you earn. You can still be eligible for Tax-Free Childcare.
If you have more than one job
You can use your total earnings to work out if you meet the threshold. This includes:
- earnings from any employment
- earnings from any self-employment
If you’re both employed and self-employed
You can use just your self-employed income if this would make you eligible.
For example, if you expect your average self-employed earnings over the tax year to be more than you’ll get over the next 3 months as an employee.
Income that does not count towards your minimum earnings
Some types of income will not count towards the minimum amount you must earn to be eligible. These include:
- dividends
- interest
- income from investing in property
- income from a pension
Your immigration status
You must have a National Insurance number and at least one of the following:
- British or Irish citizenship
- settled or pre-settled status, or you have applied and you’re waiting for a decision
- permission to access public funds - your eVisa or UK residence card will tell you if you cannot do this
If you have a partner
Your partner must have a National Insurance number too.
If you’re living in an EU country, Switzerland, Norway, Iceland or Liechtenstein
You (or your partner if you have one) might still be eligible for Tax-Free Childcare if:
- your work is in the UK
- the work started before 1 January 2021
- you’ve worked in the UK at least once every 12 months since you started working here
This is known as being a ‘frontier worker’. You must show your Frontier Worker permit to the Childcare Service when you apply for Tax-Free Childcare.
If you’re not eligible for Tax-Free Childcare
You may be able to get other help towards childcare costs.
If your child is between 3 and 4 years old and you live in England, you can get 15 hours of free childcare a week for 38 weeks of the year.
If you or your child get extra support, you may be eligible for free education and childcare for 2 year olds.
If you have a foster child and live in England, you may be able to get Free Childcare for Working Parents.
3. If you get Universal Credit or childcare vouchers
You cannot get Tax-Free Childcare at the same time as claiming Universal Credit or childcare vouchers.
Which scheme you’re better off with depends on your situation.
Use the childcare calculator to work out which type of support is best for you.
Universal Credit
Wait until you get a decision on your Tax-Free Childcare application before cancelling your Universal Credit claim.
Childcare vouchers
You must tell your employer within 90 days of applying for Tax-Free Childcare to stop your childcare vouchers or directly contracted childcare.
They’ll then stop the vouchers or directly contracted childcare.
You may have to give HM Revenue and Customs (HMRC) evidence of leaving the childcare voucher scheme - for example, a copy of the letter telling your employer you’re leaving the childcare voucher scheme.
If your partner gets vouchers or directly contracted childcare, they’ll also need to tell their employer within 90 days to stop them.
4. Apply for Tax-Free Childcare
Use this service to apply for Tax-Free Childcare.
If you live in England, HM Revenue and Customs (HMRC) will also check if you’re eligible for Free Childcare for Working Parents when you apply for Tax-Free Childcare.
If you already get Tax-Free Childcare, you can sign in to your childcare account to confirm your details are up to date and pay your childcare provider.
What you need to apply
You’ll need your (and your partner’s, if you have one):
- National Insurance number
- Unique Taxpayer Reference (UTR), if you’re self-employed
You’ll also need:
- the UK birth certificate reference number (if you have one) of any children you’re applying for
- the date you started or are due to start work (this can be approximate if more than 3 months ago)
If you’re a company director
You’ll need to show you meet the minimum income requirements to be eligible. HMRC will try to check this using your PAYE records.
If you do not submit regular PAYE information, you may have to provide evidence to show you are working and expect to meet the minimum income requirements for the next 3 months.
This could be:
- wage slips
- bank statements
- a statement from your accountant
- copies of invoices
If you’re not paid regularly (for example, once a year) you may need to send other evidence to show you’ll meet the minimum income requirements, such as:
- annual wage slips
- year end payroll
- a letter from your tax agent or adviser confirming your salary has been paid and taxed
You’ll need to do this the first time you apply, and every time you reconfirm your eligibility.
If you have a partner
You must include your partner in your application if you are:
- married or in a civil partnership and live together
- not married or in a civil partnership, but living together as though you are
Their employment and income will not affect your eligibility if they:
- are or will be absent from your household for more than 6 months
- are a prisoner
You and your partner cannot both have accounts for the same child.
If you are separated
You and your ex-partner need to decide who should apply if you are jointly responsible for your child.
If you cannot decide, both of you must apply separately and HMRC will decide who gets a childcare account.
When to apply
You can apply any time unless:
- you’re starting or re-starting work
- you’re on maternity, paternity, shared parental or adoption leave
If you’re starting or returning to work, your start or return date will determine when you need to apply.
| When you’re starting or returning to work | When to apply from |
|---|---|
| Between 1 May and 30 September | From 1 April |
| Between 1 October and 31 January | From 1 September |
| Between 1 February and 30 April | From 1 January |
Apply
You’ll need to set up a childcare account.
It usually takes 20 minutes to apply.
If you’ve been unable to use the service
You may be able to claim compensation if you’ve been unable to access your account due to technical problems with the childcare service.
After you’ve applied
You’ll usually find out if you’re eligible straight away, but it can take up to 7 days.
Contact the Childcare Service helpline if you applied more than 7 days ago and you have not heard from HMRC.
5. Sign in to confirm your details are up to date and pay your provider
To keep getting Tax-Free Childcare you must sign in to your childcare account every 3 months to confirm your details are up to date.
When you sign in, you can also pay money into your account, pay your childcare provider and apply for Tax-Free Childcare for an additional child.
Sign in to your childcare account
You’ll need your user ID and password to sign in.
If you’re having problems signing in to your account
Contact the Childcare Service helpline if you’re having problems signing in to your childcare account.
If you’ve been unable to use the service
You may be able to claim compensation if you’ve been unable to access your account due to technical problems with the childcare service.