Help with Childcare Costs - Help with Childcare Costs when You are Working

Universal Credit childcare costs 

You will only be able to get help with your childcare costs through Universal Credit if you are claiming Universal Credit. Use the Turn2us Benefits Calculator to find out if you could get Universal Credit.

How much will I get?

If you get help with your childcare costs through Universal Credit, you will get up to 85% of your childcare costs, up to a maximum of £1,031.88 a month for one child, or £1,768.94 for two or more

You can claim help with childcare costs for any children under 16 who you are responsible for.

How can I apply?

To claim help with childcare through Universal Credit, you will need to claim Universal Credit. If you are already getting Universal Credit but aren’t getting help with childcare costs, you should report these costs in your journal.

How do I report my childcare costs?

You will need to report how much you have paid in childcare costs each assessment period. You will also need to provide evidence of how much you have paid. Make sure to report the costs within the same assessment period or the one just after, or you might not get the money back. 

If you pay for childcare that covers more than one assessment period, you will only get an amount of childcare costs element in each assessment period that covers the costs for childcare that took place in that assessment period.

For example, Kirsty’s child goes to an after school club for 10 hours per week at £3 per hour. The school asks parents to pay each term. Kirsty therefore needs to pay 15 weeks childcare costs at once, which comes to £450. This falls into three assessment periods and she is paid as if she had £150 of childcare costs in each assessment period. 

How is it paid?

Help with childcare through Universal Credit is paid to you and not to your childcare provider. It is paid in arrears, which means it will only be paid to you after you have paid your childcare provider.

Tax-Free Childcare

Through the Tax-Free Childcare scheme, the government will pay £2 for every £8 you spend on childcare, up to a maximum of £2,000 per year per child (or £4,000 for a child with a disability). 

Can I get it?

You can get Tax-Free Childcare for children under the age of 12. If your child has a disability and gets Disability Living Allowance (DLA), Personal Independence Payment (PIP) or Armed Forces Independence Payment (AFIP), or is sight impaired, you can get Tax-Free Childcare until the child turns 17.

You can’t get Tax-Free Childcare at the same time as Universal Credit. If you claim Tax Free Childcare, it won’t stop your Universal Credit automatically, but you will be asked to close your claim for Universal Credit. You also can’t get it at the same time as childcare vouchers.

To be able to get Tax-Free childcare, you have to satisfy the earnings rules:

Your income over the next 3 months for you and your partner (if you have one) must each expect to earn at least:

• £2,539.68 before tax if you’re aged 21 or over (equivalent to £195.36 per week)
• £2,080 before tax if you’re aged 18 to 20 (equivalent to £160 per week)
• £1,570.40 before tax if you’re under 18 or an apprentice (equivalent to £120.80 per week)

If you are self employed and started your business less than 12 months ago, you might still be eligible if you earn less. 

I'm not currently working 

If your partner is working, and you're on carer's leave or getting any of the support listed below, you might still be eligible:

• Carer's Allowance or Carer Support Payment 
• Severe Disablement Allowance 
• Incapacity Benefit
• Limited Capability for Work Benefit
• contribution-based Employment and Support Allowance (ESA)

How much will I get?

If you get help with your childcare costs through Tax-Free Childcare, the government will pay £2 for every £8 you spend on childcare, up to a maximum of £2,000 per year per child (or £4,000 for a child with a disability). 

How can I apply?

You can apply for the Tax-Free Childcare scheme online.

How is it paid?

It is managed through an online account. Your childcare provider will be paid direct from this account.

Flexible Support Fund

If you are receiving Universal Credit and are going to struggle to pay for childcare costs upfront, you may be able to get help through the Flexible Support Fund. Money from the Flexible Support Fund does not have to be paid back.

How do I apply?

Contact your work coach or leave a message in your Universal Credit journal to ask if you can get support from the Flexible Support Fund. Your work coach will decide if you're eligible and consider a discretionary payment from the fund. 

Sometimes your work coach will complete the forms with you, and will give you a form called an FSF3. You will need to ask your childcare provider to complete one of the sections.

What if I am refused?

If they refuse, you may be able to get a Universal Credit Advance to pay the up front childcare costs. An advance will have to be paid back. If you live in Northern Ireland, you can get help through the Adviser Discretion Fund with your first month's childcare costs and still reclaim the costs from your Universal Credit.

Free Childcare for Working Parents scheme

Some working families can get 30 hours of free childcare per week for their 9 month to 4 year olds. This is delivered through the Free Childcare for Working Parents scheme. 

Most childcare providers ask families to take this as 30 hours per week over 38 weeks per year but you might be able to change how you take it.

Can I get it?

You may be able to get 30 hours free childcare per week if you are:

• living in England, and
• in work or about to start a new job, and
• earn over a certain amount

Your income over the next 3 months for you and your partner (if you have one) must each expect to earn at least:

• £2,539.68 before tax if you’re aged 21 or over (equivalent to £195.36 per week)
• £2,080 before tax if you’re aged 18 to 20 (equivalent to £160 per week)
• £1,570.40 before tax if you’re under 18 or an apprentice (equivalent to £120.80 per week)

If you are self employed and started your business less than 12 months ago, you might still be eligible if you earn less. 

I'm not currently working 

If your partner is working, and you're on carer's leave or getting any of the support listed below, you might still be eligible:

• Carer's Allowance 
• Severe Disablement Allowance 
• Incapacity Benefit 
• Limited Capability for Work Benefit 
• contribution-based Employment and Support Allowance (ESA)

If you're off work because you're on annual leave, off sick or you've had a baby, you are still eligible for free childcare. 

How do I apply?

Visit the GOV.UK website to find out when to apply and to create an online account for Free Childcare for Working Parents.

You can use the eligibility checker on the Best Start in Life website to see what you could be entitled to.

Early Years Pupil Premium 

Some children who receive extra support might also be able to get an extra payment called the Early Years Pupil Premium. This money is paid to the childcare provider directly, and is used to support the learning and development of the child. To get the Early Years Pupil Premium you usually have to get certain benefits, or your child must be cared for by a local authority in England or Wales. 

To apply, speak to your childcare provider or contact your local council. 

Northern Ireland Childcare Subsidy Scheme (NICSS)

This scheme provides a 15% reduction (up to £184 per month) in approved childcare costs for eligible working parents in Northern Ireland for qualifying children. 

Can I get it?

To be eligible, you must be getting Tax-Free Childcare and your childcare provider must be signed up as a Tax-Free Childcare Provider with HMRC. 

How can I apply?

You need to register your child online using the NICSS portal.