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"Ed Balls' reply to my Childcare agitation. Suggestions needed." blog discussion

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  • Is it beyond the wit of the assorted government departments to just CHANGE OUR TAX CODES so if you have a child eligible for assistance (of what ever nature) then your TAX CODE is changed so you don't reclaim money back from the government that they took off you in the 1st place.

    That way NO ONE would need to claim
    NO ONE (especially the low paid target group) would miss out on this 'benefit'
    and
    it would be cheaper to run (which is good for all of us as it will save TAX money for every TAX PAYER)

    Just why do these people make it so difficult; complicated and obscure; do they have a desire to maximise paper work; and mimimize the benefits ?
  • Related irrationality re childcare & tax credits that I'd really like raised: I work as an Ofsted Registered Childminder. The number of children I care for at any one time is - rightly - strictly limited by the terms of my Registration. Parents of these children can claim Childcare Credit - but unless I place my own child/ren in a nursery or with another Minder I can't claim, despite the fact that my own child takes up one of my childcare places. For example if I'm registered to care for 3 under 5's and my own child is 4, then one of those places is taken by my own child reducing my potential earnings by a third. They receive the same high standard of education and care as the other children & I don't want to place them elsewhere - so why shouldn't I be able to claim Childcare credit like any other parent for that place??
  • adon30
    adon30 Posts: 181 Forumite
    edited 7 August 2009 at 6:04AM
    My partner is about to start a full time nursing diploma course. We are not able to get any grants or add-ons to help. We are also unable to get the childcare tax credits because HMRC says that only one of us is working. Despite her having to do 35 hours a week full time education and 'working' in hospitals as part of the course!

    I am lucky enough to have the childcare voucher scheme at work and will probably take it up. This will save me a maximum of about £700-800 in tax out of my wages. Nothing like the £3,500 if both of us were classed as working. I will also only be able to take the vouchers from January and I am then locked in for a year with this scheme. So if circumstances change I am stuck with it. The voucher schemes really need to be made more flexible and have an equal standing with childcare tax credits.

    All of this money will have to go on childcare for our two young children and I have calculated over the 3 years of the nursing course I will be between £15k-20k in debt. I think I will be looking at the boards for additional money saving ideas.

    So basically one of the schemes will not pay out when you desperately need some help with childcare as a student in education is not classed as working and the other only doesn't provide enough benefit to be useful. Maybe there should be more of a balance between the two schemes so that benefit differences are not so large. After all you are only receiving back some of the tax that you have to pay in the first place and the people actually doing the childcare pay tax on that again. So the HMRC don't loose out on the tax anyway.
  • Here is a radical suggestion for all those people whinging about their tax credit / voucher entitlement for child care. Why not do away with it entirely. I appreciate that children are the future and will eventually help pto contribute to pension pots. But, and this is the big but, people who do not have children for one reason or another get no relief at all and end up paying overall for other people's children. Maybe parents / parents to be should work out if they can afford children and not rely too much on state help. When my parents had me and my sisters they only got the child allowance. Nothing else. Maybe people should take responsibility for paying for their children rather than relying on the generosity of everyone. If you cannot afford to have children - DONT HAVE THEM!
  • adon30
    adon30 Posts: 181 Forumite
    edited 7 August 2009 at 6:01AM
    Why does Spindoctor assume that they are paying for our childcare? The way I see it is that it is tax relief on my earnings which in turn pays for childcare from a ofsted registered provider. Who then in turn pays tax on their earnings. It only covers a small percentage of the childcare (Someone will probably now how much) and the HMRC gets the tax anyway in the end.

    The rest of the childcare costs I have to front myself. Not really living of the state.
  • I think it makes absolute sense for the money allocated towards childcare costs goes directly to the childcare provider; this will alleviate all problems on both sides.
    To be honest; I only thought that you could choose which scheme to opt for; i.e childcare vouchers OR help through childtax credits and what works out best for you.
    No wonder there is so much confusion; hopefully by Martin raising the issue will get this mess sorted out and everyone entitled to help comes out on top!
  • cclarke12
    cclarke12 Posts: 231 Forumite
    I would love to see the childcare voucher scheme changed so that instead of the entitlement being £243 per month per parent, that is was per child, i.e. if you have two children each parent could take £486 of their salary in vouchers. The childcare vouchers really have saved us money when paying for my first child's nursery place, however, with a second child starting nursery in Jan the cost to us will more than double as we don't get any further tax relief. For parents needing full-time nursery care in London/South East (particularly) it is a tough call on whether it is worth going back to work when you have more than one child of nursery age. Providing the voucher allowance for each child might tip the balance in some cases.
  • The only suggestion I have for Martin is to start talking to David Cameron, this Govt' is not capable of making any change, they've made a mess but it'll be someone else who'll have to clear it up!
  • Martin

    Can you please ask the question why CCV's are per parent, and not per child?
    It seems wholly unfair that 2 parents might be able to claim for 2 voucher allowances for 1 child, where 1 parent with 2 kids can only claim for one voucher allowance.??!!???
  • cue
    cue Posts: 64 Forumite
    Part of the Furniture Combo Breaker
    of all HMRC tax 'schemes' this one boggles the mind the most.

    It doesn't help that you get conflicting 'advice' from their helplines..... personal experience has taught me to be very sceptical of what they say is in your best interest.
    Negative equity of £100k. including the mortgage :)
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