Six-month extension on employer childcare voucher scheme

There is a six month delay in the closure of the workplace employer childcare voucher scheme.

The new Tax-Free Childcare scheme, which was introduced in April 2017, will replace the voucher scheme. The new policy will provide support to parents of up to £2,000 a year per child (under the age of 12) to help cover childcare costs.

The government confirmed that the workplace voucher scheme will remain open for a further six months to new entrants. This followed concerns that parents would potentially have to pay some childcare costs upfront.

119,000 members of the public signed a petition and 45 MPs across all parties signed a letter to the Chancellor to keep the childcare voucher scheme open. Research has suggested that many families would be better off under the employer-administered scheme. This is because it is more generous than tax-free childcare for those on middle and lower incomes.

The new system has also encountered problems. Thousands of parents have been unable to set up an account on the HMRC website. Many also did not have to access the money they had paid into them.

Many hope that the voucher scheme and the tax-free childcare scheme can remain permanently open to give parents the choice.

If you are an employer who is considering implementing an employer-supported childcare scheme so that employees have a choice, we recommend that you consider your options as soon as possible.

If you have any questions, please contact Clair Williams.