Make sure you and your working parents don’t miss out on the savings.
Childcare Vouchers are a way for your employees to pay for their chosen childcare through salary sacrifice.
As an employer you can save up to £402 per employee on the scheme each year by not paying the 13.8% NI contribution on the salary they sacrifice.
Your employees can save up to £933 per year on their childcare costs so by offering this benefit you will be increasing employee motivation, retention and can use it as a great recruitment incentive.
The Government have proposed a Tax-Free Childcare (TFC) scheme which will only be open to some working parents (where both parents are working or single parents) and the parent is not already getting support through the existing Childcare Voucher scheme, earning less than £150,000 annually and not be receiving support through tax credits. So many parents will not be able to claim so should join an employer scheme before it’s too late.
Until then Employer Childcare Voucher parents will be able to sign up for employer supported Childcare Vouchers and they can then continue to order vouchers, making tax and National Insurance savings, for as long as their employer continues to run the scheme or until their child is 15 years old (or 16 years old if disabled), whichever is sooner.
N.B. Providers typically charge the employer approximately 4.5% of the voucher value for this type of scheme.