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Hi all,
Just been browsing the forum and noticed that nobody had posted regarding childcare vouchers, not sure if this is something people are aware of?
Childcare Vouchers are a government initiative to help working parents with the rising cost of childcare. It is a salary sacrifice scheme where you are able to sacrifice part of your salary for childcare vouchers. The amount you sacrifice is exempt from tax and national insurance! The rules surrounding this have changed recently but here is a breakdown of how much you can save.
-------------------------------Amount that can be sacrificed---------Annual Savings
Basic Rate Taxpayer------------------------£243----------------------------£933
(£0 - £42,475)---------------------------------------------------------------------
Higher Rate Tax Payer---------------------£124----------------------------£623
(£42,476 - £150,000)-------------------------------------------------------------
Additional Rate Tax Payer------------------£97-----------------------------£606
(£150,000+)-----------------------------------------------------------------------
It is a completely free scheme to run and helps thousands of working parents each year.
To find out more and check your eligibility follow this link:
http://www.computersharevoucherservices.com/parents/Pages/am-I-eligible-for-childcare-vouchers.aspx
Hope this information is helpful to someone out there!
I've used these in the past, and it did save me a chunk of money, plus because it was all online, paying was much easier. Unless the rules have changed, you can only change the salary sacrifice once a year, so if you are going to use these, draw up a budget for your childcare costs over the next year - and if you are getting near to the age where your child will no longer need care, sacrifice slightly less than you need as you can't get a refund on the vouchers.
One thing to be aware of (again, unless it's changed) is that by paying by childcare vouchers, the amount you pay no longer counts towards childcare costs when calculating child tax credits, so worth taking this into account, speak to HMRC to find out how much it would reduce your child tax credits (I think it affected the low paid workers more).
Good call bringing this onto the forum 🙂 )
Hi Actd,
Yeah things may of changed slightly since you last used them although there are various companies out there that will put a "shelf life" on vouchers or will not let you refund you vouchers afterwards.
I would recommend Computershare Voucher Services; they are the leading childcare voucher provider. They will allow you to change the amount you sacrifice as frequently as you like (as long as your employer has not capped this), there is no expiry date on the vouchers and Computershare will refund your vouchers if you request it (although it is refunded through your salary so as tax and NI is applicable again 😉 )
I use E-Vouchers which allows me to build up childcare vouchers online (a bit like online banking) and then pay my childminder direct from there.
One last point I am not sure if you are aware but you are able to pay for breakfast/afterschool clubs, music lessons and summer holiday camps with childcare vouchers so there is always some use for them right up to the age of 15!
When my daughter is old enough and I am not using childminders i will sacrifice a small amount throughout the year to enable us to pay for a summer camp for her during the 6 weeks holidays!
Hope this helps you save even more £££ in the future!
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