The government has further extended Tax-Free Childcare (TFC) scheme to 31 October 2020. The scheme applies to the parents who may have fallen below the minimum income requirement as a result of the coronavirus (COVID-19) pandemic.
The Government’s Tax-Free Childcare scheme offers up to £2,000 a year per child towards childcare costs. However, only a quarter of the 1.3 million families eligible for the help have signed up.
HMRC confirmed that key workers who may exceed the income threshold for the 2020/21 tax year as a result of working more due to the pandemic will continue to receive support.
The TFC scheme provides families with a £2 government top-up for every £8 they pay into their child’s account, up to the value of £2,000 per child, or £4,000 per disabled child. The parents can use the money towards the cost of qualifying childcare for a child up to the age of 11, or 17 for a disabled child.
How to benefit from the Tax-Free Childcare (TFC) Scheme?
The government won’t cut Tax-Free Childcare and free nursery hours in England if you’re temporarily working less. The additional free 15 hours of nursery time (on top of the 15 hours everyone gets) for three and four-year-olds and the Tax-Free Childcare scheme are dependent on earning a minimum income of £140/week. When schools and childcare provisions return, if you’re temporarily earning less, you’ll still be able to get both as normal. These measures will remain in place until at least 31 October.
Commenting on the matter, Angela MacDonald, Deputy Chief Executive at HMRC, said:
‘HMRC has been providing vital financial support to families during a time when it has been needed most, and we will continue to help them as they gradually transition back to a normal life.
‘We want to make sure families will not be adversely affected by any abrupt change in circumstances, which is why we have extended available support through TFC to give families that extra boost.’
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