Finance Bill 2015 and instead will legislate in a future Finance Bill. This will mean that the income tax exemption will not come into force from 6 April 2015 as previously advised.
Other changes to benefits and expenses (the abolition of the £8,500 threshold, collection of income tax on BiKs in real time (payrolling) and the paid and reimbursed expenses exemption) will be legislated in Finance Bill 2015, which has been published today. Please follow the link to the Bill for more details.
CIPP survey response: Tax-Free Childcare - consultation on design and operation
15 October 2013
The CIPP policy team has submitted its formal response to the consultation on the design and operation of the new Tax-Free Childcare scheme.
Background At Budget 2013, the government announced the introduction of Tax-Free Childcare for working families whereby the government will provide 20 per cent of working families’ childcare costs, subject to an annual limit of £1,200 contribution for each child. This is equivalent to basic rate tax relief of childcare costs up to £6,000 a year. Under Tax-Free Childcare, parents will register with a voucher provider and open an online account. The government will then ‘top up’ payments into this account at a rate of 20p for every 80p that families pay in, subject to the above limit. Households in which all parents work but do not receive support through tax credits (or Universal Credit) will be eligible for Tax-Free Childcare, so long as neither parent is an additional rate taxpayer. Tax-Free Childcare will be delivered by HMRC and will ultimately be available to up to around 2.5 million working families in the UK – more than the current Employer-Supported Childcare system, which is only available to some employees. Employer-Supported Childcare will therefore be phased out, though existing members will be able to choose whether to remain on their current scheme or move to Tax-Free Childcare. Tax-Free Childcare will be phased in from autumn 2015. From the first year of operation, all children up to age five – and disabled children under the age of 17 – will be eligible. The scheme will then build up over time to include children under 12. CIPP response The policy team has been involved in consultation meetings and our response includes anecdotal evidence as well as collective member views from the survey we distributed in September.
You can read our response in full through the link at the bottom of this page, but in summary we made the following recommendations :
Providing accurate guidance and information is critical to the success of this process. Tailored to the needs of the different stakeholders involved: employers, employees, voucher providers, childcare providers, professional advisers and the media; information should be delivered in a timely manner and be backed up by a range of support services provided by HM Revenue & Customs.
CIPP Policy News Journal
08/04/2015, Page 167 of 521
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