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  • FIRST POST
    • MSE Archna
    • By MSE Archna 3rd Oct 06, 12:01 PM
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    MSE Archna
    Childcare Vouchers: cut childcare costs by 1,000/year Discussion Area
    • #1
    • 3rd Oct 06, 12:01 PM
    Childcare Vouchers: cut childcare costs by 1,000/year Discussion Area 3rd Oct 06 at 12:01 PM


    This thread is specifically to discuss the content of the

    Childcare Vouchers: cut childcare costs by 1,000/year Article

    To discuss or ask a question about the article: click reply

    For the old thread click here

    Report inappropriate posts: forumteam@moneysavingexpert.com




Page 31
    • rpc
    • By rpc 13th Apr 17, 1:14 PM
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    rpc
    So you save either 630 or 1250 a year using vouchers as a higher rate tax payer.

    You spend 10,200 on childcare, of which 10,000 can benefit from the new scheme. Under the new scheme, you would save 2k.

    When number two arrives, you get another 10,000 allowed costs so you can save up to 4k. You voucher savings wouldn't change.

    Seems quite straightforward to me - go for the new scheme.

    Using the new scheme will affect your salary (it isn't salary sacrifice) so there could be an impact on child benefit charge and other salary related benefits/taxes.
    • nightfrogs
    • By nightfrogs 6th May 17, 3:58 PM
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    nightfrogs
    Apologies if this has been asked before (similar to 2 posts above but slightly different).

    I am on my company's voucher scheme but my partner's employer does not offer it so we only get 243 after tax as vouchers/month.

    Our chilcare costs are close to the 10k/year so presumably, on the new scheme, we'd get double the amount (up to 2k tax free (+ reduction in salary sacrifice & increased company pension contribution)?

    Thanks!
    • rpc
    • By rpc 6th May 17, 4:51 PM
    • 2,301 Posts
    • 3,493 Thanks
    rpc
    Currently, you save ~900 a year assuming that you are a basic rate taxpayer.

    Under the new scheme you will save 20% (~2k).

    Fairly easy decision...

    Your salary will increase which can affect other things. You pension is down to the rules your employer uses (vouchers don't affect mine).
    • afly
    • By afly 31st May 17, 2:15 PM
    • 99 Posts
    • 54 Thanks
    afly
    With the scheme being scrapped to new entrants soon does anyone know if there anything to suggest the government will stop honouring vouchers in the years to come? Or that care facilities will stop accepting them?

    What I don't want to do is spend year 1 acquiring vouchers whilst the wife in on mat leave only to find in year 2 when I need to use them that no-one will take them anymore
    • rpc
    • By rpc 1st Jun 17, 12:59 PM
    • 2,301 Posts
    • 3,493 Thanks
    rpc
    With the scheme being scrapped to new entrants soon does anyone know if there anything to suggest the government will stop honouring vouchers in the years to come? Or that care facilities will stop accepting them?
    Originally posted by afly
    Nope. Plan seems to be that the two schemes will run in parallel and vouchers will wind down as people naturally stop claiming them. There may be a reduction in the number of voucher providers over time as the reducing number of participants might make them unprofitable to run, but that will take a while.
    • cheesemason
    • By cheesemason 19th Jul 17, 9:51 AM
    • 76 Posts
    • 4 Thanks
    cheesemason
    Hoping someone can help me with a query, because I cant seem to find the answer on Google anywhere.


    I get childcare vouchers under the old system. I will soon be getting a payrise which (with bonuses) may take my annual income to over 45k (also may not!)


    For argument sake, say with bonus I get 46k. Now on the face of it, that would mean the amount of childcare vouchers I get falls to the 124 a week from 243 a week


    However, our pension is salary sacrifice. So saying I put 4k into a pension, that takes my salary down to 42k


    Would that mean I would still get the 243 a week, or do they not include the pension bit
    • cheesemason
    • By cheesemason 19th Jul 17, 10:35 AM
    • 76 Posts
    • 4 Thanks
    cheesemason
    Actually found a good article on the gov.uk website (https://www.gov.uk/government/uploads/system/uploads/attachment_data/file/368483/employer-qa.pdf)


    This seems to suggest that it is worked out after pension has been deducted and also doesn't include most bonuses (mine is company and personal performance related, so could in theory be zero)


    If that's the case, I am way under the threshold, which would be nice!


    Can anyone confirm that I am right please?


    Thanks
    • onlyroz
    • By onlyroz 19th Jul 17, 2:07 PM
    • 13,645 Posts
    • 25,980 Thanks
    onlyroz
    Do you have protected rights? If you've been claiming vouchers since before April 2011 then you can keep the 243 a month regardless of your salary.
    • cheesemason
    • By cheesemason 19th Jul 17, 2:26 PM
    • 76 Posts
    • 4 Thanks
    cheesemason
    Only been claiming two years unfortunately
    • rpc
    • By rpc 20th Jul 17, 1:09 PM
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    rpc
    Your employer will do a basic earnings assessment at the start of every tax year. That determines your eligibility regardless of your actual income during the year. If the one carried out for the 17/18 tax year says that you are below the threshold, your eligibility isn't changed until the next assessment in April 2018.

    More detail here: http://www.computersharevoucherservices.com/employers/Pages/The-Basic-Earnings-Assessment.aspx


    If you look at the manual linked to from that page, you see what is excluded. Also note that your bonus is only included if it is contractual.

    In short, your occupational pension (but not any personal pension) reduces your income for the purpose of getting more childcare vouchers.
    • cheesemason
    • By cheesemason 20th Jul 17, 1:31 PM
    • 76 Posts
    • 4 Thanks
    cheesemason
    What is classed as a contractual bonus though? In my contract it says if I perform well and the company performs well I will get x%. If I don't or the company doesnt its on a sliding scale down to zero

    Would that bonus be excluded?

    Cheers
    • rpc
    • By rpc 21st Jul 17, 11:35 AM
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    • 3,493 Thanks
    rpc
    What is classed as a contractual bonus though? In my contract it says if I perform well and the company performs well I will get x%. If I don't or the company doesnt its on a sliding scale down to zero

    Would that bonus be excluded?

    Cheers
    Originally posted by cheesemason
    The HMRC technical guidance says it only applies to guaranteed bonuses. Kiddicare state that performance related or discretionary bonuses are excluded.

    So if your employer does it right, I think your bonus isn't counted (I am not a lawyer, tax advisor, etc, just some bloke on the interwebs). Not all employers do this calculation right and mistakes can be hard to correct...
    • cheesemason
    • By cheesemason 21st Jul 17, 12:02 PM
    • 76 Posts
    • 4 Thanks
    cheesemason
    Thanks for your help
    • liviboy
    • By liviboy 8th Aug 17, 4:29 PM
    • 365 Posts
    • 127 Thanks
    liviboy
    With vouchers on the way out soon, do you think there will be any movement at all on the 243/month limit?

    Childcare costs are rising but the amount able to be claimed isn't...

    This could be a big cause to switch to TFC sooner than anticipated...
    • Squiressms
    • By Squiressms 4th Sep 17, 3:07 PM
    • 1 Posts
    • 0 Thanks
    Squiressms
    Tax-Free Childcare
    My husband receives childcare vouchers through his work which he uses to part pay our childminder.
    I have been invited to join the Tax-Free Childcare scheme as I am self employed.
    Can we do both or would my husband have to come off his scheme and give me money to top up the tax free childcare account?
    Thank you
    • rpc
    • By rpc 5th Sep 17, 12:59 PM
    • 2,301 Posts
    • 3,493 Thanks
    rpc
    Can we do both
    Originally posted by Squiressms
    Nope. Not allowed under the rules of the new scheme.

    or would my husband have to come off his scheme and give me money to top up the tax free childcare account?
    Thank you
    Yes, but make sure it is better for you than using his vouchers.
    • always29
    • By always29 7th Oct 17, 8:28 AM
    • 475 Posts
    • 2,388 Thanks
    always29
    Hope someone can help me calculate net pay after vouchers please. My employer has finally signed up to the scheme and I am on a fixed term contract til March 2018. The CCV provider has told me I can back date vouchers to the start of this tax year so effectively deducting 486 a month but I am trying to work out my net pay if I did this. Having this stock of vouchers would cover child care for the whole of this academic year and remove the worry of paying for childcare if I end up with a job gap. Thanks!
    • sheramber
    • By sheramber 7th Oct 17, 1:36 PM
    • 3,967 Posts
    • 2,954 Thanks
    sheramber
    First of all if you deduct 468 from your months pay will you still be paid more then NMW? If not, then you cannot do it.

    Nobody can tell you your net pay without knowing

    your total income to date,

    tax deducted and

    tax code.

    Amount of month's income before 468 deducted and

    details of any other deductions made from your income , such as pension payments.
    • Jacqs79
    • By Jacqs79 15th Nov 17, 8:51 AM
    • 2 Posts
    • 0 Thanks
    Jacqs79
    Addition to Salary vs Salary Sacrifice
    Hello,
    In the first part of the article, you mention an employer can pay for and 'give' these vouchers to the employee. My company have agreed to do this while I'm on maternity leave (thank you!) - its a benefit they can provide to 'keep me' but doesnt impact my Maternity Allowance. However, I'm not clear how it's to be done. One voucher company Ive spoken to only process 'salary sacrifices' and not 'additions to salary'. They suggested my company pay my vouchers directly on my behalf - is this above board? I dont want to get anyone in hot water. Does the company benefit with no NI deductions this way? Is there any guidance on this?
    • Jacqs79
    • By Jacqs79 15th Nov 17, 9:07 AM
    • 2 Posts
    • 0 Thanks
    Jacqs79
    Freephone 'Better Off Calculation'
    I get childcare vouchers through salary sacrifice with my employer but my husband doesn't as his company do not have a scheme. Is it possible for me to continue to get the vouchers and for my husband to apply for the tax feee childcare? I'm not sure if you can mix and match?
    Originally posted by Rfrancis
    There is a Family Benefits Advisory Service on Freephone 0800 028 6538 where you can receive a personal 'better off' assessment. They look at all benefits you could recieve but they specifically told me about this issue so I could understand if Tax Free vs Vouchers were better for my family.
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