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Thousands of parents missing out on £2,000 a year tax-free childcare

Thousands of parents missing out on £2,000 a year tax-free childcare

24 July 2024  

Up to 800,000 parents could be missing out on the tax-free childcare scheme

Parents are missing out on a tax-free childcare scheme worth up to GBP2,000 annually for each child. Hundreds of thousands of parents are failing to cash in on the UK government scheme.

Only 500,000 people are claiming for help even though it is available to more than 1.3 million people. That means a total of 800,000 parents are not actually taking up the offer.

The scheme goes towards the cost of nurseries or after-school clubs. The financial aid can also be used to cover the cost of holiday clubs.

Parents who are eligible for the tax-free scheme can get up to GBP500 every three months per child, reports The Sun. That works out to GBP2,000 every year

However, there are certain criteria that parents must pass to be able to be eligible for the scheme. Both parents, if living together, must be on minimum wage and working at least 16 hours a week. That means for every three months you must both earn at least GBP2,379.

It's ok if you earn at least GBP9,518 over the course of the year if you have an irregular income, are self-employed but do not earn GBP2,379 every three months. Every child can receive a claim from their families until September 1 after their 11th birthday - or this goes up to their 16th birthday if they are disabled.

But parents cannot use the tax-free scheme if they are on Universal Credit or receive tax credits. People can risk losing their benefits if they apply this way but benefit claimants can receive help through Universal Credit with childcare costs instead.

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