View more on these topics

Govt boosts childcare support to £2,000 per family

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”.

Recommended

George-Osborne-Treasury-700.jpg

LV= doubles annuity cancellation period in response to Budget reforms

LV= has doubled its annuity cancellation period to 60 days in response to radical pension reforms announced by Chancellor George Osborne in the Budget. The changes revealed by Osborne yesterday will allow people to take their entire pension pot as cash from age 55. The new rules will apply from April next year. Under interim […]

Roy-McLoughlin-MM-Peach-700.jpg

Roy McLoughlin: How to boost protection take-up through auto-enrolment

Ask any adviser who operates in the corporate space and they will tell you that we are firmly immersed in auto-enrolment land. Describing the situation as bordering on chaos is not an exaggeration at all. Capacity issues, middleware confusion and problems with payroll are contributing but the refreshing feedback from all parties is that, contrary […]

Economic recovery fuels staff retention worries

The economic recovery is generally good news but it is driving concerns among UK financial firms about retaining their best staff. Research by recruitment firm Robert Half found that 87 per cent of companies are worried about losing their top employees to other firms and more than half plan to increase base salaries for existing employees. […]

Newsletter

News and expert analysis straight to your inbox

Sign up

Comments

There are 2 comments at the moment, we would love to hear your opinion too.

  1. When the PM and DPM both have to deny they’ll be claiming this tax benefit, I’m guessing the Government have lost the arguement before it even starts.

  2. Vouchers still better for one child in nursery with two working parents and childcare costs under £10k

Leave a comment