Childcare Vouchers started mid way through year

Dooha490

Hello,

I have just started utilising the Childcare Voucher Scheme offered by my employer, I am a higher rate tax payer and eligible for a maximum exception of £124 per month. My payroll department has said the exemption can be doubled to £248 per month due to the scheme being enrolled halfway through the financial year. In April 2018 the amount will be reduced to £124 again.

My question is, can they do this? My wife has enrolled on the scheme the same time as me and her employer has said it is not possible to double the exemption.

Anyone able to confirm which employer is correct?

Thank you

Darksparkle

Employers can offer more than the capped amount but the amount over the cap wouldn’t be exempt from tax/nic.

Dooha490

Hi Darksparkle,

My question doesn't really relate to going over the cap. My question relates to the tax free portion only. Does the tax free amount run from April to April or rolling 12 months? My employer believes April to April, which is why they have doubled my monthly contribution for 6 months only.

The calculations below reflect what my employer is trying to achieve.

October 2017 - April 2018 = 6 x £248 = £1488
April 2018 - April 2019 = 12 x £124 = £1488

If the tax free amount runs from April to April then I guess the doubled amount of £248 is permissible, assuming the annual of £1488 can be claimed in an alternative manner.

Thanks,

sheramber

Your voucher company may allow subject to requirements.

Check with the voucher company concerned.