Childcare Costs discussion

bhoy1976

My wife and I are in conflict over the two available schemes.


I've used a few tools out there to assess our options and it always appears to point towards us using the Childcare Voucher Scheme.


As of September, we will have a 3 year old and a 9 month old in childcare, three days a week, during term time only. Our 3 year old is covered completely by the 30 hours a week free childcare so we are only paying for our 9 month old.


Our Childminder had intimated that we would be better off in the Tax Free Childcare Scheme because we can put more money into it. I'm loathed to argue with someone who has been in the business for decades and can see where she is coming from but the online calculators suggest that we can save more money on the voucher scheme.


Any advice?

sheramber

bhoy1976 wrote: »

My wife and I are in conflict over the two available schemes.


I've used a few tools out there to assess our options and it always appears to point towards us using the Childcare Voucher Scheme.


As of September, we will have a 3 year old and a 9 month old in childcare, three days a week, during term time only. Our 3 year old is covered completely by the 30 hours a week free childcare so we are only paying for our 9 month old.


Our Childminder had intimated that we would be better off in the Tax Free Childcare Scheme because we can put more money into it. I'm loathed to argue with someone who has been in the business for decades and can see where she is coming from but the online calculators suggest that we can save more money on the voucher scheme.


Any advice?

Your child minder is in the business of childminding not giving financial advice.

Why would she know more about your affairs than you do?

If you feel it necessary print out a copy of the calculators showing you are better off with the vouchers..

Personally, I would ignore her.

lidbin

Hi.
I am a single, working mum of a 9 month year old. I’m about to return to work 4 days a week for about £25,000 salary and will be spending £40 a week on childcare. I’m registered for Universal credit and will be logging childcare hours with them - they say they will cover up to 85% of childcare costs but I was going to get vouchers to pay to recoup the tax.
My childminder has warned me that if you apply for more than one scheme they can withdraw all assistance - as if it’s tax credits and tax free vouchers you’re avoiding tax twice. What order should apply for funding and should I register for vouchers before the window closes in October?
Sorry it’s complicated - I can’t find guidance on the .gov website and am confused!
Many thanks.

sheramber

You can use employer vouchers but can only claim the amount you actually pay from UC , so the balance after using the vouchers.

However, read this as you may lose more from UC than you gain from the vouchers

https://www.litrg.org.uk/tax-guides/help-towards-costs-childcare/employer-supported-childcare/how-do-vouchers-interact-other#toc-universal-credit-and-childcare-vouchers

Kes2014

Wondering if anyone knows if you change jobs after the childcare voucher cut-off date, will you no longer be eligible for childcare vouchers? I’m currently on tax free childcare but due to changing circumstances think childcare vouchers may be the better option so thinking of applying. However I’m also thinking of moving jobs soon, so would it be a waste of time changing?

sheramber

Kes2014 wrote: »

Wondering if anyone knows if you change jobs after the childcare voucher cut-off date, will you no longer be eligible for childcare vouchers? I’m currently on tax free childcare but due to changing circumstances think childcare vouchers may be the better option so thinking of applying. However I’m also thinking of moving jobs soon, so would it be a waste of time changing?

https://www.gov.uk/help-with-childcare-costs/childcare-vouchers

From 4 October 2018, childcare voucher schemes will close to new applicants. You may be able to get Tax-Free Childcare instead.

You can keep getting vouchers if you’ve joined a scheme and your wages have been adjusted before the scheme closes in October 2018, as long as:

you stay with the same employer and they continue to run the scheme
you do not take an unpaid career break of longer than a year

GreenHats

I have come here to ask for input and explore options as have hit a brick wall after having sought advice from my employer HR dept, my childcare vouchers provider and HMRC.

I am married with an almost 2-year old boy who goes to nursery. My DH is employed full-time on £42K and he receives childcare vouchers through a scheme offered by his employer. So far so good.

From September (this month), I will be upping my hours, essentially back to work c. 20 hours per week, plus 10 hours studying. We are not eligible for tax credits as earn above the permitted threshold. However, I would in principle be eligible for both childcare vouchers and tax free childcare, as I am 50% employed and 50% self-employed. As my DH already claims vouchers, we are disqualified from applying for tax free childcare as you cannot have both in the same household.

My employer offers a childcare voucher scheme (through a different provider from DH). The HR dept has advised that I may not earn above national minimum wage on a monthly basis to qualify for vouchers. This confuses me. I will be employed for c. 35 hours per month through that employer, and at £40 p/hr will be earning above minimum wage on an hourly basis. Does this mean, I need to earn above a certain average across the month?

HMRC claim I would be eligible for tax free childcare as a self-employed person earning c. £12,500 on top of my employment income, but as we cannot claim both in the same household, this is not an option for us. I cannot claim childcare costs as expenses.

Although I will be bringing in an income of c. £20,000 p/a through both channels, it seems as I am part employed, part self-employed, that I have fallen into a bit of a no-man's land.

The current value of our childcare vs vouchers is £300 per month childcare cost, for which we receive c.£240 in vouchers, paying the remainder to the nursery. With the increase in hours, I will have to put DS in nursery 4 days per week, doubling our childcare costs to £600. It seems that I/we will have to stomach the full cost, with our current arrangement.

Am I right in thinking that our only two options (on a monthly basis) are:

1) DH receives £240 vouchers, pay the remaining £360 from my salary

2) forgo the childcare vouchers, and use the tax-free option. Our total childcare per year would cost around £3,000 so we can only expect to claim £600 through tax-free childcare scheme?

Any advice would be welcome.

cymru_cowboy

Hi all,
Me and my wife have been trying to work out how best to pay for childcare but are somewhat confused as to the best results from the Gov calculator.
I'm on 52k a year and pay 124 in childcare vouchers a month. My wife has previously been retraining as a teacher and started work as a teacher in Sept and is on 23k. Our chilcare costs are circa 600 a month for the 3 kids.

Given our current situation I'm finding it difficult to work out whether we are better off if I continue to stay on the childcare voucher scheme and we pay the remainder of the childcare costs from my wife's wages or whether I leave the childcare scheme and we go for tax freee childcare that we both then pay into. Any insights gratefully received.

Regards

izoomzoom

twh wrote: »

Hi all,

I am a bit confused about some of the 30 hours childcare (nd guess i'm not the only one!). If we do not use the hours, do we 'lose' them?

For example, if my child did two 6 hour days at local pre-school that only runs term time and one 10 hour day in a nursey/pre-school for 50 to 52 weeks per year, I would theoretically have 12 hours 'spare' to use in holidays. Could I use these to top-up at another pre-school or with holiday clubs?

Thanks

Doesn't seem to be anyone on this thread, who actually answers questions, but I can answer yours

Funded hours are worked out for 38 weeks a year (term time only), at 15h (universal) or 30h (extended) per week.

Some providers stretch the offer, so over a 52 week year, you'd get 10.96h (universal) or 21.92h (extended 30h offer).

You can only use the number of hours per week, you cannot bank them up to use more in some weeks than others.

There are also rules on how those hours can be used during the week - (term time) and can be taken in any combination of hours per day with a minimum of 2.5 hours and a maximum of 10 hours

HTHs

sheramber

cymru_cowboy wrote: »

Hi all,
Me and my wife have been trying to work out how best to pay for childcare but are somewhat confused as to the best results from the Gov calculator.
I'm on 52k a year and pay 124 in childcare vouchers a month. My wife has previously been retraining as a teacher and started work as a teacher in Sept and is on 23k. Our chilcare costs are circa 600 a month for the 3 kids.

Given our current situation I'm finding it difficult to work out whether we are better off if I continue to stay on the childcare voucher scheme and we pay the remainder of the childcare costs from my wife's wages or whether I leave the childcare scheme and we go for tax freee childcare that we both then pay into. Any insights gratefully received.

Regards

Try this

http://www.tax-free-childcare.info/childcare-savings-calculator/