MSE News: Government plans more help with childcare costs 7 January 2013 at 1:50PM in MoneySaving mums 6 replies 2.2K views

Former_MSE_Helen

"The Prime Minister and his deputy will publish the coalition's mid-term review, which includes a tax break for parents..."

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Government plans more help with childcare costs

dave76

we currently get just over £1800 via the childcare vouchers scheme (equivalent to £5800 off the taxable income) - I will be interested to see how they convert it to "up to £2000" tax relief. It would certainly be good if single parent families can claim that much as at the moment it is a per parent allowance which is very unfair on single parents.

jeanmd

Call me cynical but.... Government removes some child benefit affecting the people earning over 50k meaning they lose a maximum of £1,040 per child each year. Government brings in.... £2,000 tax relief for every child, not mean tested. So will the people on lower incomes still be able to claim extra to cover childcare costs? Or it's it just really a tax relief for the wealthy? I do also feel the ones who will also be seriously affected are single earner families, just over the threshold to lose child benefit. Glad I'm just a granny who provides free childcare when needed.

DigiGuru_2

I'd love to see this brought in, as I work for a small-mid sized company and we don't yet have the voucher system in place.

My wife wants to go back in to study and become a teacher, however the childcare costs are currently rather prohibitive.

Even if she wanted to go back to work at the moment, her entire wage would be taken up by childcare (In fact we calculated we'd be worse off if she worked)

philby79

My company currently gives me the £243 worth of childcare vouchers without me having to make a salary sacrifice. Is this kind of benefit likely to be lost if this change to the current system goes ahead?

fluffysox

philby79 wrote: »

My company currently gives me the £243 worth of childcare vouchers without me having to make a salary sacrifice. Is this kind of benefit likely to be lost if this change to the current system goes ahead?

That effectively means your employer gives you more salary to offset your contribution to the childcare voucher. This is unusual. The childcare voucher system is not something most employers contibute to. Its just a deduction from gross salary so only the remainder is taxed. I use a childmin2 days a week and that comes to 240. I'm lucky that my mother also has my child 2 days. I agree though that the system is unfair on single parents. If we needed 5 days childcare, under the current system, both of us would need to claim max childcare vouchers and supplement it with cash. And nurseries are more expensive still. So i think some increase is necessary. In addition, low income families shoild have more access to free or subsidised childcare via schools or surestart centres etc with shorter waiting lists particularly if they have an opportunity to return to work

eccles-cake

philby79 wrote: »

My company currently gives me the £243 worth of childcare vouchers without me having to make a salary sacrifice.

Hi, my employer currently has the same set up and I get £243 per month in vouchers as well.

However, this week everyone has been asked to sign an addendum to their employment contracts to say that we agree to the company deducting the annual voucher amount (in my case £2916) from our salaries. This will effect our overtime pay, company sick pay, redundancy pay, SMP, SSP, etc. I'm not thrilled about this especially as I'll be needing mat leave in the not too distant future. I'd prefer not to sign and continue as I am, but I'm not sure whether this is an option and whether I'll just be binned from the voucher scheme if I don't sign.

Has anyone been in a similar position? Any advice is much appreciated.