The sun is shining (although with the British weather, by the time you’re reading this, it’s fully likely that it’s raining again!) and July approaches. However, for many of us, the start of July also begins the countdown to the start of the school holidays, and potentially, the challenge of trying to juggle work and childcare.
In this week’s blog, we take a look at the ways in which you can help fund that childcare, because we all know, it isn’t cheap!
Voucher scheme/Direct Agreement
First off, it is worth noting that, since October 2018, both of these options are no longer open to new claimants. If you were already claiming either via your limited company before October 2018, then you are fine to continue claiming.
Voucher Scheme– with this scheme, vouchers are paid to employees which would then be used to pay for childcare. Your childcare provider will claim back their fees and there will be an admin fee from the company who issues the vouchers.
Direct Agreement– with this option, the employer will pay a provider for childcare costs on behalf of the employee. The amount paid will be set out in an agreement between the employer and employee (up to £243/month).
If, however, you did not sign up to either of these schemes before October 2018, then you can instead use the Tax Free Childcare Scheme.
Tax Free Childcare Scheme
With this scheme, you are able to receive up to £500 every three months (up to £2000/year) per child (under 11) to help with the costs of childcare (this is doubled for a child with disabilities).
For every £8 that you pay into your childcare account, the government will pay in £2, and this account can be used to pay for approved childcare providers, which will include nurseries, childminders, after school clubs etc.
To qualify, there is a number of criteria, so it is best to check your personal circumstances here before claiming. If you are working through a limited company, you will need to ensure that you are earning at least the minimum wage (for 16 hours work per week) over the next 3 months, so you will need to have a salary set up. if you are self employed (and have been for more than 12 months), you will also need to expect to earn the equivalent amount over the next 3 months.
So, even if you don’t qualify for the voucher scheme or direct agreement via your limited company, there is an option for you to help with those summer childcare costs. Because let’s face it, after the last two years, many of us will be quite happy to see the back of having to try and juggle work and keeping the kids entertained!
PaperRocket Accounting provide accounting and tax services to professional contractors, freelancers, and small businesses working in the UK.
We offer our clients a flexible choice of fixed fee monthly packages which cover all of their accounting and tax needs (so no hidden costs or surprise bills!). All of our accounting packages include a monthly subscription for a cloud accounting software subscription provided by the awarding winning FreeAgent.
Each of our clients is given their own dedicated qualified accountant with unlimited access in person, telephone, or by email.
We pride ourselves on our client satisfaction and customer service and were awarded ‘Best Contractor Accountancy’ firm 2020 in The Contracting Awards and ‘Welwyn Hatfield Business of the Year 2019’ in the SME Hertfordshire awards.
To find out how we can help you please get in touch now.