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Tax-Free Childcare opens to all parents with children under 12

Press release   •   Feb 14, 2018 00:01 GMT

From today, all working parents with children under 12 can apply for up to £2,000 of childcare support per child, per year.

Parents, including the self-employed, can apply online for Tax-Free Childcare by visiting Childcare Choices. Parents can also access the government’s childcare calculator through Childcare Choices, which helps parents to choose which government childcare support is best for them. The support is worth up to £4,000 for disabled children.

More than 190,000 parents have successfully applied and now have a Tax-Free Childcare account they can use to pay for a wide range of regulated childcare, including nurseries, childminders, after school or holiday clubs.

For every £8 parents pay into their childcare account the government will add an extra £2. Once eligible parents have opened their new account they can start paying their childcare provider straightaway, using the government contribution.

Nicole, a mum of twins from Greater London, who uses Tax-Free Childcare, said:

“I was concerned about the cost of childcare, because I don't get any other support, and I'm a single mum with 15-month-old twins. Tax-Free Childcare has taken a big burden off my shoulders. It's massively helped me: the extra money makes a huge difference, and I find the system really easy to use. It allows me to comfortably work full time, knowing that my children are being well looked after.”

Liz Truss, Chief Secretary to the Treasury, said:

“Tax-Free Childcare will cut thousands of pounds from childcare bills and is good news for working parents.

“More parents will be able to work if they want to and this demonstrates our commitment to helping families with the cost of living.

“All eligible parents with children under 12 can now apply through Childcare Choices and should take advantage of the available support.”

Tax-Free Childcare builds on the support already available to thousands of families including:

  • enhanced childcare support through Universal Credit
  • 30 hours free childcare
  • tax credits for childcare

Notes for Editors

How Tax-Free Childcare works

  1. Working parents can apply, through the childcare service, to open an online childcare account. For every £8 that families pay in, the 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 electronic payments directly to their childcare providers. The maximum government top-up is £500 per quarter for each child.
  2. All registered childcare providers – whether nannies, nurseries, childminders or after school clubs – can sign up online now 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.
  • By the end of the Parliament, we expect Tax-Free Childcare will support around a million families with their childcare costs.
  • Tax-Free Childcare is replacing Employer-Supported Childcare, including ‘childcare vouchers’, which is only available to parents if their employer offers it. Employer-Supported Childcare will be closing to new entrants from April 2018, but parents who are already a member of the scheme will be able to remain in it as long as their employer continues to offer it. The tax and National Insurance exemption for workplace nurseries will remain in place. Parents moving from Employer-Supported Childcare to Tax-Free Childcare can still use childcare vouchers they’ve previously accrued.

 3. An animation setting out the new childcare offer is available here.

 4. High resolution images of the Childcare Choices logo, infographic and website can be found here.

Issued by HM Revenue & Customs Press Office

HM Revenue & Customs (HMRC) is the UK’s tax authority.

HMRC is responsible for making sure that the money is available to fund the UK’s public services and for helping families and individuals with targeted financial support.