Running your own business often means balancing client deadlines, cashflow, and family life — and childcare can be one of the biggest pressures on working parents. With the autumn half-term approaching, HMRC is reminding families that the Tax-Free Childcare scheme can help reduce those costs.
What’s Available?
Under the scheme, you can receive up to £2,000 a year per child towards childcare costs (or up to £4,000 if your child is disabled).
For every £8 you pay into your childcare account, the government adds £2 — giving you a 25% top-up. These funds can be used for approved childcare providers, including:
- Nurseries and childminders
- Breakfast and after-school clubs
- Holiday clubs and play schemes
Just make sure your childcare provider is registered with the scheme before you pay them — most reputable providers already are, but it’s worth confirming.
The account is flexible, too. You can pay in as often as you like, use the funds immediately, or save them for future school breaks. If your situation changes, any unused money can be withdrawn at any time.
Who’s Eligible?
The Tax-Free Childcare scheme isn’t just for employees — self-employed parents and company directors can benefit as well. You may qualify if:
- Your child is 11 or under (or 16 if they have a disability)
- You and your partner (if applicable) each earn at least the National Minimum or Living Wage for 16 hours a week, on average
- You each earn less than £100,000 per year
- You’re not claiming Universal Credit or childcare vouchers
How to Apply
You can apply quickly and easily through the Tax-Free Childcare section of GOV.UK.
Each child needs their own account, and the government top-up is added separately for each one. Once your account is set up, you’ll need to reconfirm your details every three months to continue receiving the top-up.
With school holidays coming up, now’s a great time to check if you’re eligible! For busy parents — especially those running their own business — the Tax-Free Childcare scheme can make a real difference to managing costs and maintaining peace of mind.
e: office@londonaccountants.co t: 0203 137 9791
Kind Regards,
The Team at London Accountants
