What is a Tax Free Childcare Account?

There are going to be some very significant changes for the better when it comes to the working family child care expenses.

These costs are always one of concern for families who have children in need of

proper day care. In some cases the costs can be so high that it offsets the viability of

generating additional income.

If you have children and are also part of the working world then chances are you are going to be interested in Tax Free

Childcare Account.

20% Cost Savings for Families

This, a new Government childcare account is meant to lift the burden of childcare expenses that working families experience. In many cases it will mean that 20% of this expense can be eliminated. While it won't prove beneficial for the majority of the 2015 year, it will kick in by the autumn of this year. You will still have to pay for 80% of your childcare, but this new program should be more beneficial than the current childcare voucher program. Also, not everyone had the opportunity to use the voucher program whereas with this new Tax Free Childcare Account there may be more that can qualify for it.

Registering Online Should Make Things Easier

This Government Childcare Account is going to take a little getting used to and will require the setting up of a government account through an online registration. Once done it creates an easier process to pay the childcare provider through this online account, which you will contribute money to. You will have to assume 80% of the expenses and the Government will add the other 20%, needed to reach the total child care expenses.

Are you Eligible for the Scheme

For those that will be eligible for the new Tax Free Childcare it means being able to earn a minimum of £50 a week for both parents and the maximum is capped.

Single parents can also qualify if they meet these criteria.

Universal Tax Credit

The Tax Free Childcare program will be bundled together with Universal Tax Credits, which will be replacing the existing benefits scheme.This aims to streamline the process of receiving payments for those who are currently using the benefits system.

The Other Option

The Childcare Vouchers Scheme is another option, and could save many

parents even more money (32% vs 20%). It would be on each individual

case, but it is well worth checking out the scheme prior to the old scheme being phased out as you could still

opt into the scheme if it benefits you.

To know more about Tax Free Childcare Account visit:

http://taxfreechildcareaccount.co.uk/

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