It is disappointing that some organisations involved in the existing scheme felt the need to take and persist in this costly and wasteful course of action, which has led to a delay in the launch of Tax-Free Childcare.
We are now pressing ahead with the scheme as part of our ongoing commitment to support working families.”
Tax-Free Childcare is part of the government’s long-term plan to support working families and will provide up to 1.8 million families across the UK with up to £2,000 of childcare support per year, per child, via a new simple online system. The government is clear on the importance of supporting families with their childcare costs. Spending on childcare was increased by £1 billion in the last Parliament and the government has also committed to doubling free childcare for working parents of three and four year olds to 30 hours a week.
Key points for parents about Tax Free Childcare 7 July 2015
Even though employers will have no direct administrative duties under Tax-Free Childcare, it will be useful to have knowledge of the scheme when employees start to ask questions relating to existing Employer-Supported Childcare.
We recently reported that the new Tax-free Childcare has been delayed and is now expected to launch from early 2017. The existing Employer-Supported Childcare scheme will remain open to new entrants until Tax-Free Childcare is launched. Tax-Free Childcare will be available to up to 1.8 million households to help with the cost of childcare, enabling more parents to go out to work, if they want to, to provide greater security for their families. Here’s the top ten things for parents to know about the scheme. 1. You’ll be able to open an online account 2. For every 80p you or someone else pays in, the government will top up an extra 20p 3. The scheme will be available for children up to the age of 12 4. To qualify, parents will have to be in work, earning just over an average of £50 a week and not more than £150,000 per year 5. Any eligible working family can use the Tax-Free Childcare scheme - it doesn’t rely on employers offering it 6. The scheme will also be available for parents who are self-employed
7. If you currently receive Employer-Supported Childcare then you can continue to do so 8. Parents and others can pay money into their childcare account as and when they like 9. The process will be as simple as possible for parents 10. You’ll be able to withdraw money from the account if you want to
Further details of these ten key points are available on GOV.UK .
More information will also become available ahead of the scheme being introduced so parents making childcare decisions are able to consider all their options.
Employer-Supported Childcare and Tax-Free Childcare 27 August 2015
HMRC provided an update in their latest Employer Bulletin which mentioned the delay of the launch of Tax-Free Childcare until early 2017. As a result of legal action a suspension was placed on the development of the scheme which prevented key delivery steps from taking place. The Supreme Court confirmed on 1 July that the government’s proposals for delivering Tax-Free Childcare (TFC) were lawful. This upholds previous judgments from the High Court and the Court of Appeal. The government welcomed the court’s judgment but has also announced that, as a direct result of the delay caused by the legal challenge, Tax-Free Childcare will now launch from early 2017. The government has also announced that the existing Employer-Supported Childcare scheme (ESC – often known as childcare vouchers) will remain open to new entrants until Tax-Free Childcare is introduced.
CIPP Policy News Journal
25/04/2016, Page 160 of 453
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