Monday, September 27, 2021

Parents urged to prepare for tax free childcare scheme

Parents have been urged to prepare for the rollout of the government’s delayed tax free childcare accounts scheme.

Chris Hutton, partner with Mountsorrel-based Charnwood Accountants, said the initiative is designed to benefit the self-employed, as well as people working for organisations which do not provide child care vouchers.

The government unveiled its tax free childcare accounts in 2014, to replace the employer-provided childcare voucher scheme, but legal wrangles delayed the launch.

Hutton, who is also the co-owner of a children’s day nursery, said: “The new accounts will at last be introduced on a trial basis in early 2017. The new scheme will then be rolled out across the country based on the results of the trial.

“The rules are complex, but where both parents work and earn at least £115 per week, they will be able to put up to £8,000 a year into a special account which the government will top up with 20p for every 80p contributed by the parents.

“This account can only be used to pay for childcare such as nursery fees”.

Hutton said it was anticipated that the new scheme will eventually replace the existing childcare voucher scheme.

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