Childcare Vouchers tax thresholds

Jwalters_2

My husband and I can both apply for childcare vouchers through our employers. I am a basic rate tax payer and he is a higher rate tax payer. We need £300 worth of vouchers each month. My husband can apply for £124 a month. I can apply for £243 a month. Can we save more in terms of tax and NI if I claim £243 worth of vouchers a month and my husband claims £57 a month or if my husband claims £124 a month and I claim £176 a month? Or does it not really make any difference?!

Thanks in advance for your help!

alipops1986

Jwalters wrote: »

My husband and I can both apply for childcare vouchers through our employers. I am a basic rate tax payer and he is a higher rate tax payer. We need £300 worth of vouchers each month. My husband can apply for £124 a month. I can apply for £243 a month. Can we save more in terms of tax and NI if I claim £243 worth of vouchers a month and my husband claims £57 a month or if my husband claims £124 a month and I claim £176 a month? Or does it not really make any difference?!

Thanks in advance for your help!

Both me and my Husband both claim Childcare Vouchers.
Although we only need about £300 a month, we both claim the maximum amount we can - £480 in total, as the vouchers last 18 months, so we like to have a good amount of these saved in case of unforeseen issues!
I don't think it really makes much difference who claims what to be honest.
My sister works in HR/Finance and she said even the higher rate tax payers at her work manage to claim £243 - so not sure how that works!

onlyroz

Claim as much as you can even if it's more than you need at the moment. Vouchers can accumulate and be spent on after school and holiday clubs once the kids reach school age.

onlyroz

alipops1986 wrote: »

Both me and my Husband both claim Childcare Vouchers.
Although we only need about £300 a month, we both claim the maximum amount we can - £480 in total, as the vouchers last 18 months, so we like to have a good amount of these saved in case of unforeseen issues!
I don't think it really makes much difference who claims what to be honest.
My sister works in HR/Finance and she said even the higher rate tax payers at her work manage to claim £243 - so not sure how that works!

I didn't think vouchers had an expiry date - just that they had to be spent before the child reaches 16. As for the higher rate tax payers claiming £243, they probably have protected rights, because they started claiming before April 2011.

rpc

A higher rate tax payer gets a little more benefit than a basic rate taxpayer because of the way the NI works. £933 saved per year for a basic rate taxpayer and £623 for a higher rate taxpayer (assuming you claim the maximum entitlement). But that higher rate taxpayer is only claiming half the voucher amount and is saving nearly two-thirds as much.

If you claimed £100 per month then, as a basic rate taxpayer your would save £384 per year while a higher rate taxpayer would save £504 for the same amount of vouchers.

This all assumes standard tax allowances and no BIK.