Childcare Vouchers/MoneySavingExpert.com Discussion

arethusa82

The Inland Revenue require a mimimum of 12 months notice to exit the scheme, unless there are life changes. They are the ones who decide what the life changes are. There is no reason why vouchers could not be used for after school care, or during school holidays provided the carer is registered with Ofsted. See my earlier post for the link to the Inland Revenue document.

As a matter of interest I have resolved the pensions issue. Taking part in the scheme does not affect pension contributions, as they are based on the salary prior to taking into account the salary sacrifice.

claretherookery

can these vouchers be used to ofset private school fees? does anyone out there know.....

hex2

The Busybees pack does explain that certain occupational pensions may be affected by salary sacrifice - NHS councils etc. Classic case of public sector giving with one hand and taking away with the other. It is really up to the trustees of the individual scheme or your employers in the private sector.

Inland Revenue stuff on salary sacrifice is intended to combat people doing avoidance deals - eg paying for car via salary sacrifice rather than being taxed on a company car. When Busybees rang me to see if the company was interested they told me that there was no minimum period to do it for. I suspect most of the limits are being set by the companies themselves to minimise the administrative burden.

Bad luck for teachers - that is seriously wrong for an underpaid and undervalued group of people. This does seem to target mid and high income private sector employees without a pension.

peach_2

I'm self employed (sole trader) and use some childcare so these vouchers sound great. Can I use this scheme?

hex2

peach wrote:

I'm self employed (sole trader) and use some childcare so these vouchers sound great. Can I use this scheme?

I had a good search round the IR website on this area and couldnt see any comment either way. Got to be worth a phone call to them to check? Please do post the answer - I plan to do consultancy in the future so useful for me to!

The link for the IR employers pack on childcare is http://www.hmrc.gov.uk/childcare/employers-guidance.htm

There is a contact number for questions on there to.

rgoodenough

My wife set and administered this scheme for her last company. She "sold" it to the management by letting them know that there was a money saving for the company (in reduced NI fees). Her company saved £10K in 2 years!

Someone posted about the pension effects - this is true - the company does not have to pay pension contributions at the "real" salary level. They can choose to pay it at the reduced level.

If you have a child in full-time nursery costing maybe £600/month, the savings can be enormous - esp. for a 40% tax payer (40% of £600 each month!)

You can also use salary sacrifice and childcare vouchers at the same time.

Jackiekaren

nmbash wrote:

I work for a BIG company that did set this up from the start, which was great - I got to use it for 3 months and noticed the difference.

However, we get a yearly benefits allowance that we can use to spend on critical insurance, life cover, childvouchers etc. These choices can only be amended once a year unless a 'lifetime' change occurs; ie dead, marriage, divorce. Child going to school is not in the list.

Since I only needed it for 9 months (child starts school in January) it was not worth me joining. My monthly childcare would go automatically from my salary to Accor (voucher people) where it goes to my account. Unfortuately, if there is a SURPLUS of money in the Accor account you cannot get a refund. At least my company weren't doing it. Since I will not be needing childcare once he goes to school I could not use the surplus that way.

Bash, sounds like you work for LogicaCMG. That's exactly the same deal. However, you can get around the "lifestyle change" problem by telling them your partner has given up work to look after the kids, or that you have changed childminders. They don't check any of this (it's impossible). But if your child is going to school that WILL be a lifestyle change, an I'm 99% sure you can get a refund under this change.

On another note, (for othr readers)you can also get the vouchers online, which saves waiting for paper ones. An electronic account is created that you have control over. The funds go into the account, then you can distribute it however you like. eg. pay more or less each month.

P.S, You didn't hear the first bit from me

supermum1958

Just felt I should say: my husband, his sister and brother and I run a single, successful and happy nursery. We have been on the receiving end of these vouchers fior quite a while now. Unfortunately, they are a misery from the nursery's point of view. The vouchers are run by a middle-man organisation which loses them, forgets to credit them, and frequently takes months to reimburse us for them. The admin involved in keeping track of them is expensive and time-consuming - and all round they are an absolute misery and yet another way for the government to claw more money out of small businesses. We HATE them. I know they save you all money, and of course there's no arguing with that - but we pay for it.

The usual story - the government courting popularity at the expense of entrepreneurs and small businesses.

rgoodenough

supermum1958 wrote:

The vouchers are run by a middle-man organisation which loses them, forgets to credit them, and frequently takes months to reimburse us for them.

I don't suppose that would be a company that has the initials something like UK?! If so, I feel your pain!

Bob

Bilk

Ok, I feel like I am getting ready to kick my self her. My employer bought in this scheme over a year ago but I was told as a higher rate tax payer it was not worth me doing this! So just to be clear...is it worth if for me?

Thanks Bilk