Tax-Free Childcare
What does Tax-Free Childcare mean for me?
Tax-Free Childcare is a UK wide offer. Eligible parents with children under 12 can get up to £2,000 per child, per year, towards their childcare costs (or up to £4,000 for disabled children under 17).
Parents entering the scheme open an online childcare account which they use to pay you directly for childcare. Payments work just as they do through an online bank account. Each payment is accompanied by a reference number for each child so you can identify their payments.
You will only be able to receive Tax-Free Childcare payments from your customers if you’ve signed up to Tax-Free Childcare.
Over time, Tax-Free Childcare will replace childcare vouchers. By signing up now, you’ll be ready to accept payments from parents as soon as they ask to pay using Tax-Free Childcare.
Signing up to Tax-Free Childcare does not affect any payments you receive through childcare voucher schemes.
You can find information and materials on Childcare Choices website in the communications toolkit:
An invitation letter will be sent to you once we receive your details from your regulator. If you’ve recently registered as a childcare provider, this may take a few weeks.
Your invitation letter will contain your unique user ID to sign up online to Tax-Free Childcare and will also tell you what other details you need to sign up. If you haven’t received your invitation letter, contact the childcare service helpline.
How to identify a Tax-Free Childcare payment.
When a parent pays you using their childcare account, the transaction will appear on your bank statement as National Savings A.
This entry should also contain the child’s:
- Childcare reference number, made up of 4 letters and 5 numbers. The letters are the first initial and the first 3 letters of the child’s surname, for example, AJON12345
- Tax-Free Childcare account number. This will be 13 digits long and start with 1100, and should contain the letters TFC, for example, TFC 1100012345678.
If your bank displays payment information differently and you are unable to identify a parent's payment, you can submit a payment reconciliation form or call the childcare service helpline on 0300 123 4094.