Changes to Tax-Free Childcare Scheme

changes-to-tax-free-childcare-scheme

 

The government has announced temporary changes to its Tax-Free Childcare (TFC) scheme as a result of the coronavirus (COVID-19) pandemic.

The changes to the rules affect parents applying for, or already getting, tax-free childcare or 30 hours free childcare. Individuals whose earnings are now below the normal minimum income requirement but would normally expect to meet the income requirement remain eligible.

The temporary changes to the eligibility criteria for TFC and the 30 hours free childcare scheme will help families during the COVID-19 lockdown. The changes affect individuals who are on furlough; those unable to work or who are working less as a result of the lockdown; individuals who are self-employed; and those deemed to be an essential worker.

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Who should apply for Tax-Free Childcare?

Workers who have been furloughed are advised to apply for TFC (or reconfirm if they already have a childcare account) if their wage is at least the National Minimum Wage (NMW) for 16 hours a week and below the normal minimum income requirement, but they would normally expect to meet the income requirement.

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Those who are unable to work or who are working less should apply if they’re getting sick pay or Statutory Sick Pay (SSP); taking unpaid leave to care for others, such as children; or if they’re living with someone with COVID-19.

The self-employed should apply if they are continuing to work and their earnings are above the minimum earnings requirement; not able to get work because of COVID-19; and if they’re not eligible for self-employed income support but would expect to earn at least the minimum income requirement.

Essential workers who have missed the 31 March reconfirmation or application deadline for 30 hours free childcare should apply or reconfirm if they already have a childcare account.

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