Tax-free childcare roll out

The implementation of Tax-Free Childcare, the new government scheme to help working parents with the cost of childcare, is being rolled out to eligible parents in stages.

The scheme first made its debut in April 2017 and although there have been initial systems problems, HMRC’s aim is to have the scheme open to all eligible parents by 14 February 2018. Application is made online through the Childcare Choices site www.childcarechoices.gov.uk and applications can be made for all eligible children at the same time.

Under Tax-Free Childcare, for every £8 the parent pays, the government provides a £2 top-up, to a maximum of £2,000 per child each year – with a higher limit of £4,000 for disabled children. This gives a total childcare pot of £10,000, or £20,000 for disabled children. To be eligible, parents must generally have minimum weekly earnings of at least £120 each. There is also an upper earnings limit of £100,000.

Compensation may be available in certain circumstances where a parent:

  • is unable to complete an application for Tax-Free Childcare
  • is unable to access their childcare account
  • or doesn’t get a decision about whether they are eligible, without explanation, for more than 20 days.

Those employing a nanny should be able to use the childcare account to pay their PAYE tax and National Insurance. Delays in getting this system working may also give grounds for compensation. Application is made online GOV.UK childcare-service-compensation 

If you would like to discuss any of this further then please get in touch 0116 2423400 or https://www.torrwaterfield.co.uk/contact-us 

Did you look after your Grandchildren this summer?

Get paid to babysit!

Did you look after your Grandchildren this summer?  If they are aged under 12 you could be missing out on the chance to boost your future State Pension.

Top Grandparent facts:

  • 1 in 4 working families and 1 in 3 working mothers use Grandparents for childcare
  • 63% of all Grandparents with grandchildren under 16 help out with childcare
  • 1 in 5 Grandmothers provide at least 10 hours a week of childcare
  • the proportion of Grandparents who are of working age is set to grow as the retirement age gradually rises

Half of Britain’s 7 million working-age Grandparents have a Grandchild under the age of 16 and could qualify for Class 3 National Insurance credits for looking after children aged under 12 – which can be used to top up their income in retirement.

Applications for NI credits for caring for children under 12 need to be made to HM Revenue & Customs.  Applications need to be made in, or after, the October following the end of the tax year in which the caring took place.

Grandparents who have cared for their Grandchildren during the tax year 2011/12 are still able to apply for their credits now.

There is no minimum condition for the number of hours of care in a week as long as the credit is transferred for a full week.

This scheme will benefit women, and the self-employed who currently cannot qualify for state second pension.

If you have any questions or want to discuss this further then please get in touch 0116 2423400

Georginda Hare, BookkeeperGeorginda Hare BC.JPG

Are you a parent? What are your childcare choices?

In our Winter 2016 newsletter we led with an article about the new Tax-Free Childcare scheme that was expected to be launched in early 2017.

HM Revenue and Customs have today launched the Childcare Choices website which can be reached from the related article:

https://www.gov.uk/government/news/uk-families-will-soon-see-bills-cut-as-date-announced-for-the-launch-of-tax-free-childcare

The article also gives details of the availability of up to 30 hours of free childcare for 3 to 4 year olds from September this year.

We understand that parents can pre-register from Wednesday, with the new scheme launching at the end of April.

If you require any further information or advice then please contact us 0116 2423400 

Neil Fordintro-desktop-full

Shared parental leave – What are you entitled to?

Shared parental leave (SPL) allows employed parents and adopters to share leave and pay with their partner to care for children from birth until their first birthday.

  • Only employees can take SPL; they must have a partner (separated partners still qualify if sharing responsibility for care of child at the time of birth)
  • SPL allows mothers (or adopters) to shorten their maternity leave (and pay) to share the leave (and pay) with their partner in order to care for children in their first year; it is the mother’s choice whether to share leave
  • The mother can only share with one person; it is her choice provided her partner satisfies the qualifying conditions
  • Even if only one parent is entitled to SPL and/or ShPP (e.g. one is self-employed or not entitled to ShPP), the other partner may still  be entitled to SPL/ShPP if both satisfy the qualifying conditions
  • The employee taking SPL must have been employed 26 weeks by the 15th week before the expected week of childbirth and remain employed in the week before the start of SPL. Their partner must also satisfy an employment and earnings test
  • At least 8 weeks’ written notice must be given to end maternity leave and start of SPL
  • SPL can only be taken a week at a time but can start mid-week. SPLIT days can be used to work part-time by agreement with employer
  • SPL can be taken by both parents at the same time or at separate times; they must decide how to take it. The mother can remain on maternity leave while the partner is on SPL
  • SPL can be taken in up to three separate blocks (unlike maternity leave) or more if the employer agrees
  • There are detailed notice provisions which must be followed
  • Employees can work for up to 20 days during SPL (SPLIT days), as well as 10 days during maternity leave (KIT days). These must be agreed with employer.

 SHARED PARENTAL PAY (ShPP) 

Can pay be transferred as well as leave?

Yes.  Statutory maternity pay (SMP) is available to female employees from the 11th week before the expected week of birth or the actual birth if earlier.  It is paid for 39 weeks (the maternity pay period – MPP) with the first 6 weeks being at 90% of pay (and then either the flat rate of £139.58 or 90 per cent if this is lower for the remaining 33 weeks.  But, only 37 weeks is available for ShPP as the mother must take the first 2 weeks after the birth. Women who do not qualify for SMP will often qualify for maternity allowance which is paid at £139.58 or 90 per cent of average earnings if this is lower.

If you wish to discuss any of this in more detail please contact us 0116 2423400 

Becky Edwards, Payroll Manager 

Childcare and employer provided childcare vouchers.

Are you a working parent with a child entered into child care?

You could benefit from a cash saving scheme that wochildcare-blocks-1-thumb-2.pngrks with childcare providers………………

Childcare vouchers are a government approved benefit for all eligible working parents.

These are a tax efficient way of paying for childcare that won’t cost you anything to join.

Most childcare providers will accept childcare vouchers towards payment for your childcare costs.

Childcare vouchers can be claimed by either or both parents for children up to the age of 16.

You can exchange up to £55.00 per week, or £243.00 per month, of your gross salary depending on when you have joined the scheme and how much you earn. 

As an employer here at Torr Waterfield we run a childcare voucher scheme that assists all our working parents with children in childcare.

Not only does this help our employees with the costs but also saves the company in National Insurance costs.

Speak to your employer now and see if you are eligible….

How we can help

If your business is located in the Leicester area and you would like to discuss setting up an employer supported childcare scheme in further detail, please do not hesitate to contact us.

We also have lots more info on our website please click here  

Sarah Knight, Bookkeeping