Tax-Free Childcare
Tax-Free Childcare allows eligible working parents to save towards childcare costs using a secure online account. For every £8 you pay in, the government adds £2 — up to a maximum of £2,000 per child, per year. This equates to a 20% contribution towards your childcare fees. The funds can then be used to pay your childcare provider, such as Little Woodlands.
Timing & Payments
You can pay into your Tax-Free Childcare account via bank transfer, Direct Debit or standing order. Payments usually appear within one working day, with the government top-up added at the same time. Once funds show as “available,” you can make a payment to your provider.
Payments made to your childcare provider before 2:30pm on a working day will typically arrive the same day. Payments made after 2:30pm, or over weekends and bank holidays, may arrive the next working day. In some cases, it can take up to three working days, so we recommend planning ahead to avoid any late payment charges.
Staying Eligible
To continue receiving the government top-up, you must reconfirm your eligibility every three months through your childcare account. If you do not reconfirm by the deadline, government contributions will stop.
Planning Your Payments
We recommend topping up your account in advance of your nursery payment due date rather than waiting until the last minute. As provider payments can take time to clear, sending payment a few days before your invoice is due will help avoid any delays.
If you would like support with understanding Tax-Free Childcare, our team will be happy to guide you — just ask.