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Tax Free Childcare - Can I get Tax Free Childcare?

Tax-Free Childcare is a new scheme which is being rolled out gradually from 21 April 2017 and will offer working families 20% support towards qualifying childcare costs up to certain limits. It will eventually replace the directly contracted childcare and childcare vouchers provided by employers under the Employer Supported Childcare Scheme.

Can I get Tax Free Childcare?

At the current time, you can only make a claim if:

  • You are responsible for a child who will be under the age of four on 31 August 2017; or
  • You are responsible for a disabled child (until the last day of the week in which the 1st September following their 16th birthday falls.

The scheme will gradually be open to older children over time.  Even if you are eligible to make a claim, you will only qualify if you meet the following conditions.

Eligibility depends on the parents’/guardians’ situation, the child/children and the childcare costs involves.

Eligibility: Parents/guardians

You are usually eligible for a Tax-free Childcare account if all of the following apply.

You and your partner (if you have one ):

  • Are at least 16 years old;
  • Live and work in the UK (Special rules apply if you live or work in another country)
  • Do not receive tax credits or Universal Credit or childcare vouchers. (Child Benefit, child maintenance payments and free childcare for 2-4 year olds are unaffected)
  • Are working - employed or self-employed. If you are part of a couple, both of you must be working
  • Estimate that you earn at least £120 a week each on average over a three-month period unless:
    • You’re under 21 or an apprentice: you must expect to earn the equivalent of 16 hours at the National Minimum Wage rate that applies to you
    • You’re self-employed and recently started a new business and are still in your ‘start-up’ period (usually the first year you start trading as a self-employed person).  If you are self-employed, you may be able to average your income over a 12 month period rather than three months.
  • Neither of you expect to earn more than £100,000 in the current tax year.

You can also apply if you are on leave (sick leave, ordinary or additional maternity, paternity, adoption leave or getting Maternity Allowance, shared parental leave, annual leave) or about to start a new job.

Illness, disability or caring responsibilities

You are eligible for a childcare account if you or your partner is in work and the other gets any of the following benefits:

  • Incapacity Benefit or long-term Incapacity Benefit

  • Severe Disablement Allowance

  • Carer’s Allowance

  • Contribution-based Employment and Support Allowance

  • National Insurance credits because of incapacity or limited capability for work

If you don’t have a partner

If you don’t have a partner, you can still apply to open a Tax-free Childcare account. However, if you are jointly responsible for a child you need to agree who should apply because only one person can open a Tax-free Childcare account for a child.

Eligibility: The child

The child:

  • Usually lives with you even if you are not their parent (but you are not their foster carer)

  • Is under 12 years old (up to last day of the week in which 1st September falls following the child’s 11th birthday) if they don’t have disabilities, or

  • Is under 17 years (up to the last day of the week in which the 1st September falls following the child’s 16th birthday) and:

    • Receives Disability Living Allowance or Personal Independence Payment, or

    • He or she has been certified as severely sight impaired or blind by a consultant ophthalmologist

You can apply for Tax-free Childcare for an adopted child once a court has made an adoption order.

You can’t get Tax-free Childcare for:

  • Your foster child/children

  • Children who are living away from your home for six months or more

  • Children who are in a secure children’s home/training centre or a young offenders’ institution

  • Children who are being looked after by a local authority (even if they are living in your home), unless this is for short-term respite care.

Eligibility: Childcare

You can only use this account to pay childcare costs to help you work. The childcare must be from an approved childcare provider.

Reconfirming your eligibility

You will have to reconfirm your eligibility for these payments every three months.


Reviewed: August 2017 childcare calculator

Find out what help you can get towards childcare costs and compare your options.

Use the Childcare Calculator

Check benefit entitlement

Find out what means-tested benefits you might be entitled to, including tax credits.

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