Welcome to the Childcare Savings blogs.
This is the first post in a new blog series, Childcare Savings, that we're starting here at Workplace Nursery! We’ve created this series as a way to help let you know your options when it comes to saving money on childcare. Future blogs will explore various childcare savings opportunities including the Workplace Nursery Benefit itself, Tax-Free Childcare, 15 & 30 Hours Funding, and Child Benefit. This first blog in the new series will briefly explain all of these – so take note on the ones you think might best apply to you and keep an eye out for the release of their full-length blog posts in future.
Workplace Nursery Benefit
The Workplace Nursery Benefit is a salary sacrifice initiative; nursery fees are paid from your gross salary. One of the great aspects of this government scheme is it benefits all those involved in the childcare process:
If you're a parent - save on both income tax and national insurance contributions, reducing your nursery fees by up to 41%.
If you're an employer - offer this free benefit to employees, increasing their satisfaction & employee retention.
If you're a nursery - receive at least £1,200 per parent in additional funding.
At Workplace Nursery Ltd, we specialise in advising employers, parents and nurseries to set up and operate the Workplace nursery scheme.
Tax-Free Childcare
If eligible, the government will help support your childcare costs by giving you up to £500 every 3 months for each of your children. To start receiving this money you have to set up an online childcare account which you pay money into. The government will then make payments into the account every time you do – for every £8 you pay in, the government will add £2.
This is a great method of childcare savings if your childcare costs include anything other than nurseries. You can use these funds to help pay for other approved childcare, providing they are also signed up to this scheme.
Read more about this benefit here: https://www.gov.uk/tax-free-childcare
15 & 30 Hours Funding
Every child between 3 and 4 years old in England is entitled to receive at least 570 hours of free childcare per year – averaging out to 15 hours per week for 38 weeks of the year. Some parents might be eligible to receive even more funding, up to 30 hours per week. Eligibility for this increased number of hours depends on the following:
Your working status
Your income
Your child’s age and circumstances
Your immigration status
This funding is also available for any approved childcare provider, as with Tax-Free Childcare, but can only be used when your child is a particular age. The funding is no longer available once your child is in reception.
Read more about this benefit here: https://www.gov.uk/30-hours-free-childcare
Child Benefit
If your child is older than 4 years old, this is the benefit for you. The government’s Child Benefit offers you support for each child you have who is under 16 years of age. There are three ways in which this scheme does this:
Offering you an allowance, usually paid every 4 weeks
Giving you the opportunity to earn National Insurance credits which count towards your State Pension
Supplying your child with a National Insurance number without them applying for one
Read more about this benefit here: https://www.gov.uk/child-benefit
Take home message…
There are many government benefits available to parents to help support your childcare costs – you may even be eligible to claim a number of these benefits! We hope this blog has given you a brief overview of some of these. In future blog posts in this series we will go into more details about each of these benefits including specifics on who can apply for them, how to apply for them, and what you can expect to receive from them once signing up.
To find out more about the Workplace Nursery Benefit now, please visit the other pages on our website. If you want to know more about the other three government benefits mentioned in this blog, you can go to the relevant pages on gov.uk or wait for our upcoming blog posts about them…!
About the author
Alice is our Marketing Executive and also a developmental psychologist. She is currently studying as a PhD student at the University of Birmingham within the Birmingham BabyLab. Her research involves exploring how babies develop a sense of self-awareness, creating and using a new virtual reality system to do so.