Tax-free childcare scheme 'vital support' amid rising cost of living
26th January 2022 10:55
by Jemma Jackson from interactive investor
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Our personal finance campaigner highlights a great money saver for eligible parents.
- HM Revenue and Customs (HMRC) is reminding parents of its Tax-Free Childcare scheme, ahead of February half term.
- Nearly 316,000 working families used Tax-Free Childcare across the UK in September 2021, receiving a share of £35 million in government top-up payments towards their childcare costs – an increase of about 90,000 families compared to September 2020.
- Tax-Free Childcare is available for children aged up to 11, or 17 if the child has a disability. For every £8 deposited into an account, families will receive an additional £2 in government top-up.
Commenting, Myron Jobson, Personal Finance Campaigner, interactive investor, says: “The Tax-Free Childcare scheme is a great money saver for eligible parents, effectively offering 20% off childcare up to £2,000 a year. But a large proportion of parents are still unaware of its existence. And with the rising cost of living squeezing household budgets to breaking point, the need for help with childcare costs has become acute for many parents.
“The return of costs associated with working from the office such a commuting and childcare costs exacerbates matters for the scores who have transitioned from working from home in recent weeks.
“The uptake of the scheme continues to fall far below original estimates which is largely due to under-promotion of the initiative. Greater promotion of the initiative is still needed to raise awareness while encouraging even more parents to apply.”
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