Today, HM Revenue and Customs (HMRC) is reminding working families in Wales that they can use Tax-Free Childcare to help pay for their childcare costs over the summer.
Tax-Free Childcare – a childcare top-up for working parents – can be used to help pay for accredited holiday clubs, childminders or sports activities – giving parents and carers that extra peace of mind that their child is having fun during the school summer holidays and it can save them money.
Tax-Free Childcare is available for children aged up to 11, or 17 if the child has a disability. And for every £8 deposited into an account, families will receive an additional £2 in government top-up, capped at £500 every three months, or £1,000 if the child is disabled.
Parents and carers can check their eligibility and register for Tax-Free Childcare via GOV.UK. They can apply for an account at any time and start using it straight away. By depositing money into their accounts, families can benefit from the 20% top-up and use the money to pay for childcare costs when they need to, for example, during the summer holidays.
Myrtle Lloyd, HMRC’s Director General for Customer Services, said:
“We want to help kids stay active this summer, whether they are going to summer holiday clubs or a childminder. A childcare top-up will go a long way towards helping parents plan and pay for summer activities to keep their kids happy and healthy.
“To find out more search ‘tax-free childcare’ on GOV.UK.”
9,530 working families used their account in March 2021 in Wales. And in the same month, HMRC paid out more than £33 million in top-up payments, which was shared between more than 282,000 families across the UK.
Tax-Free Childcare is also available for pre-school aged children attending nurseries, childminders or other childcare providers. Families with younger children will often have higher childcare costs than families with older children, so the tax-free savings can really make a difference.
Childcare providers can also sign up for a childcare provider account via GOV.UK to receive payments from parents and carers via the scheme.