The Government is boosting its childcare support by offering families up to £2,000 of tax relief per child.
The Guardian reports the new package will be available for anyone with children up to the age of 12, instead of the previous proposed cut-off age of five.
Previously, the reforms were being phased in over seven years but will now be introduced in autumn 2015.
It will see 20 per cent of childcare costs covered up to £10,000, higher than the £6,000 maximum announced last March.
To be eligible, families must have both parents in work, with each earning less than £150,000 a year, who do not already receive support through tax credits and later, universal credit.
An extra £50m has also been found to provide extra help for children aged three or four from the poorest families.
The cost remains at £750m because the Treasury has drastically revised down its estimates of the number of families eligible from 2.5m to 1.9m.
It replaces the current system of childcare vouchers where the maximum relief available amounts to £930 a year for basic rate taxpayers.
The Family and Childcare Trust estimates the average family pays £11,700 a year in childcare costs.
Prime Minister David Cameron and Deputy Prime Minister Nick Clegg will jointly announce the policy later today ahead of tomorrow’s Budget.
Cameron is expected to say “tax-free childcare will help millions of hard-pressed families” while Clegg highlighted “the £50m cash injection for early education providers to support those children who need extra help in their early years”.
Labour described the package as “too little, too late”.