MEMBERSHIP INSIGHT
TFC implementation advisory forum STOP PRESS: Please note that on Tuesday 13 March Members of Parliament voted in the House of Commons to postpone by six months the date when ESC schemes will be closed to new entrants. As from 6 April 2018, employer-supported childcare (ESC) schemes in the form of childcare vouchers will be closed to new entrants. The employer and employee will need to have enacted a scheme (i.e. vouchers must have been provided by 6 April). It would be insufficient for parents, new to the scheme, to have put a marker down before 6 April 2018 to convert into use of their employer’s scheme later in the next tax year. Samantha Mann, CIPP’s senior policy and research officer, attended the tax-free childcare (TFC) implementation advisory forum in January. In advance of the meeting we had asked whether there were any specific issues that would be useful to raise on behalf of service providers and agents in relation to the employment of nannies for parents who plan to open a TFC account for their child or each of their children. Unsurprisingly the response confirmed our belief that an awful lot of calls to the helpline could be saved if only HM Revenue & Customs (HMRC) were able to build in better guidance on TFC, which service providers could then use in their own literature. Lack of detailed technical guidance has been a constant criticism levelled at HMRC as we have seen TFC rolled out. The policy team, together with other stakeholders, continue to lobby for improvements in this space. In view of this deficiency, we
information to hand and the system can provide an instant eligibility response (i.e. the data input rings true with HMRC data checks). They may, however, receive a response which would suggest that more checks need to be made or equally they may receive an instant fail response. It is no secret that there have been significant teething problems with the online service and many fixes have been, and continue to be, put in place; however, HMRC report an improving picture on service delivery. If problems do occur the helpline number is 0300 123 4097. As with any other helpline the quality of service can depend on the experience level of the member of staff answering. The number of staff on the helpline has increased to meet demand as the service has been rolled out. What information do our clients need to start the process? GOV.UK tells us that the parent and their partner (where they have one) will need their: National Insurance number; unique taxpayer reference if they are self- employed; date they started work, or are due to start; and, full details of any other government support currently in place. The Low Income Tax Reform Group (LITRG) has provided some useful information that working parents may find helpful – see https://goo.gl/bSYqaE – and, like us, the LITRG keep lobbying for more guidance. How long does it take to set up a nanny as a recipient? Assuming the nanny is already ‘approved or registered’, she will need a code which will have been in the invitation letter sent out to registered childcare providers by HMRC. If they have mislaid this they will need to contact HMRC on 0300 123 4097 for another code/user ID. Equally, if they didn’t get a letter and they are registered they should also contact the helpline. HMRC has been working with large agencies to process their nannies but this is work that is ongoing. The parent will search for their nanny using their reference number and postcode (no space in between the two). The nanny will also need her bank account details and National Insurance
thought it might be useful to share the following recent email content from a member who provides a payroll service to domestic employers of nannies as it summarises some key elements that all members might find useful. Who is excluded from tax free childcare? Working parents in receipt of tax credits or universal credit will not be eligible; parents working less than sixteen hours a week, although the self-employed in their first year of business have certain allowance built in; a parent earning in excess of £100,000 per year and those in receipt of employer-supported childcare (ESC), albeit they have until their first reconfirmation to issue a childcare account notice to their employer. The online calculator aims to provide help for working parents to decide which would prove to be more beneficial to them. ...Lack of detailed technical guidance has been a constant criticism levelled at HMRC... What is a childcare account notice? A childcare account notice notifies the employer that the employee wishes to withdraw from the scheme. It can take any written form but needs to notify the employer that they wish to withdraw from the scheme. If the parent chooses to stay in ESC they would need to repay any top up received in the first quarter. How long does it take to set up an account online? It should be an almost instant process (twenty minutes according to GOV.UK) once the identification verification process is complete. This is a process that should be familiar to anyone who has accessed their personal tax account or logged on to check their business account as the process is consistent across all HMRC online services now. However, the almost instant process assumes that the parent has all the
number and the official line is that it should take about ten minutes to
| Professional in Payroll, Pensions and Reward | April 2018 | Issue 39 6
Made with FlippingBook - Online magazine maker