tax free childcare (tfc) scheme - scottish parliament · vouchers (escvs) un-registered childcare...
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Tax Free Childcare (TFC)
Scheme
26 September 2018
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Following a review of support for working families, the UK Government has announced that existing
Employer Supported Childcare Voucher Schemes (ESCVS) will be replaced by a Tax-Free Child-
care (TFC) scheme. The TFC initiative has now been rolled out and will replace ESCVS from 4th
October 2018.
What is TFC?
The TFC allows eligible working families to claim 20% of their childcare costs, up to £2,000 per child
per year or £4,000 for a child with a disability, from the government. Parents open a childcare ac-
count and for every £8 a parent pays in, the government will pay in an extra £2. Parents can then
use the money in this account to pay their childcare provider. Full details about the TFC including
eligibility criteria and how to open a childcare account can be found at GOV.uk.
Parents already in an ESCVS will be able to choose whether they continue with their existing
scheme or move to the new TFC scheme. However, they cannot be in receipt through both
schemes at the same time. If a parent decides to switch to TFC, they will not be eligible to re-join
their ESCVS at a later date.
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What is the impact on the current childcare voucher
scheme provided by the SPCB?
TFC has now been rolled out and the existing childcare voucher scheme provided by the SPCB will remain open but will be closed to entrants from 4th October 2018. If you already use the SPCB’s childcare voucher scheme you will be able to remain in it until either:
• you sign up for TFC • your child turns 16 • You no longer have childcare costs • You leave the SPCB/Scottish Parliament
If as a parent you decide to switch to the TFC scheme you must inform the HR Office at, [email protected], so that relevant actions can be taken to cease your childcare vouchers from the SPCB’s childcare voucher scheme.
HR work advise which scheme I should choose?
No. This is a personal decision you must make based on your individual circumstances. This notice is intended to provide information to help you make an informed choice.
Where can I find further information about TFC?
Further information about the TFC initiative can be found at: www.childcarechoices.gov.uk www.gov.uk/government/news/tax-free-childcare-10-things-parents-should-know
FAQ’s
When will the SPCB’s current childcare voucher scheme close?
The SPCB’s childcare voucher scheme will close to new entrants on 4th October 2018. If you al-
ready use the childcare voucher scheme you will be able to remain in the scheme until either:
• you sign up for TFC
• your child turns 16
• you no longer have childcare costs
• you leave the SPCB/Scottish Parliament
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Can I use TFC alongside the SPCB’s childcare voucher scheme? No, TFC cannot be used in conjunction with the SPCB’s childcare voucher scheme or any other EF-CVS. Is TFC allowance pro-rated based on working hours? No, providing you and your partner, if you have one, work a minimum of 16 hours per week and meet the other qualifying criteria for TFC you may can claim the maximum allowance under the scheme. Can I use TFC allowance to pay for childcare on days on which I do not work? Yes. Can I use the TFC allowance to pay for additional registered childcare such as school holiday clubs? Yes, providing your childcare provider is a regulated or approved childcare provider under the TFC scheme. Will my childcare provider be able to accept payment through TFC? Yes, providing your childcare provider is a registered or approved childcare provider in the UK. I have signed up for the TFC, do I need to do anything else? If you currently receive childcare vouchers using the SPCB's voucher scheme, you must inform the Human Resources Office, [email protected], so that relevant actions can be taken to cease your childcare vouchers for the SPCB’s scheme. Every 3 months, you'll need to reconfirm you're still eligible for Tax-Free Childcare using your childcare service account. It's easy to do; you just tick a box to confirm that your details haven't changed. You will be reminded to do this, 4 weeks before the reconfirmation deadline. I am a member of the SPCB’s voucher scheme but not currently receiving vouchers – how does this affect me? If you are currently registered for the existing ESCVS you will be considered to have left the scheme if no childcare vouchers are issued for 12 months. After this period you will no longer be eligible to participate in the ESCVS. I use an unregistered childcare provider. Can I claim TFC? No, TFC is only available for registered childcare providers. Can I use the SPCB’s EFCVS for an unregistered childcare provider? The SPCB’s voucher scheme will close to new entrants on 4
th October 2018. Providing you have
joined the scheme before that date you can use the SPCB’s to claim for unregistered childcare. I want to use unregistered childcare in the future – if this is not provided through TFC why can I not join the SPCB’s EFCVS? We contacted HMRC in regards to our ESCVS as we currently provide vouchers for unregistered childcare. HMRC advised that the rules remain the same for both registered and unregistered child-care and once TFC is fully launched (October 2018) employers can no longer provide this benefit to new applicants. Can I open a TFC account while my partner continues to claim salary sacrifice vouchers from their employer? No, both parents must leave their respective employers EFCVS upon opening up a TFC account.
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Is a TFC account open to every parent or is it one TFC account per family? It’s one single application per family. If you have more than one child in childcare you will need to open an account for each child however you can do this as part of a single application. Has an EQIA been completed? Yes, an EQIA has been completed for this change to legislation Who can I contact in Human Resources for further information? The Pay and Pensions Team Leader, Dawn Gibbons, will be happy to assist with any queries in re-lation to this. Dawn can be contacted on [email protected] or ext 86637. How do the schemes compare? This will depend on your own personal circumstances and your childcare arrangement needs. The table on the next page provides a breakdown of how the TFC compares to the SPCB’s voucher scheme.
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Tax free Childcare (TFC) Registered Childcare vouchers (ESCVS)
Un-registered Childcare vouchers (ESCVS)
Age of children Up to 11 Up to 16 Up to 16
Savings Claim £2 for every £8 spent on childcare, up to £2000 per year per child (£4000 for a child with a disability). In order to claim £2000 you’ll need to put £8000 into your Tax-Free childcare ac-count
Up to a maximum of £52.02 per week for pre-school children and £12.97 for school age children. Available for 45 weeks per year. Vouchers paid monthly into Fideliti childcare voucher ac-count, up to a maximum of £243 per month per family. Voucher entitle-ment will be pro-rated based on working hours
Up to a maximum of £52.02 per week for pre-school children and £12.97 for school age children. Available for 45 weeks per year. Vouchers paid monthly into Fideliti childcare voucher ac-count, up to a maximum of £243 per month per family. Vouchers will be subject to tax and Nation-al Insurance. Voucher entitlement will be pro-rated based on working hours
Registered Childcare Can only be used to pay for registered childcare
Tax & NI free (up to 40% thresholds) Can only be used to pay for registered childcare
Tax & NI liability May be used for un-registered childcare pro-viders, for example grandparents
Availability Available to all parents who meet the relevant criteria
Only available for parents to register until 4th Octo-ber 2018. Once in the scheme parents may re-main until either; they sign up for TFC, their child turns 16, they no longer have childcare costs, they leave employ-ment of the Scottish Par-liament
Only available for parents to register until 4th Octo-ber 2018. Once in the scheme parents may re-main until either; they sign up for TFC, their child turns 16, they no longer have childcare costs, they leave employ-ment of the Scottish Par-liament
