Tax and employment is a complex and ever changing field, with new laws and fresh schemes being introduced all the time. Any changes in legislation that might affect you as a working parent or employer will be posted here.
Childcare Vouchers are exempt from income tax and National Insurance Contributions on values of up to £55 per week or £243 per month. This exemption is governed by certain conditions laid down by the Treasury and regulated by Her Majesty’s Revenue & Customs (HMRC):
Condition A The voucher is enables an employee to obtain care for a child who is:
a child or stepchild of the employee at whose expense, either in full or in part, the child is maintained; or
resident with the employee and is a person in respect of whom the employee has parental responsibility
Condition B The voucher can only be used to obtain “qualifying childcare”
Condition C The voucher is provided under a scheme that is open to:
the employer’s employees generally; or
generally to those at a particular location
For the purposes of conditions A and B, certain words have specific meanings as follows: "care” means any form of care or supervised activity that is not provided in the course of the child’s compulsory education. "child” is a person until the last day of the week in which falls the 1st September following:
the child’s 15th birthday; or
if the child is disabled, their 16th birthday.
“qualifying childcare” means childcare that is either registered or approved:
in England, by the Ofsted
in Wales, by the National Assembly for Wales (through the Care Standards Inspectorate for Wales)
in Scotland, by the Scottish Commission for the Regulation of Care
in Northern Ireland, by a Health and Social Services Trust
It includes:
registered out-of-school hours clubs
registered childminders, nurseries and play schemes
in England and Wales only, childcare provided in the child’s home by a domiciliary worker or nurse from a registered agency
in Scotland only, childcare provided in the child’s home by, or introduced through, childcare agencies, including sitter services and nanny agencies.
For more information about all the various organisations involved please refer to our useful links page.
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