Telephone: 01539 725855 – no phone menus – talk to a real person today who can direct you to what you need
Menu

My daughter started nursery this week. It was a little sooner than planned but we are confident that some extra help with childcare will be a positive step. After some nail biting and tears (hers, not mine…yet), she got through her first day.

My mind then turned to paying for the childcare. Grandparents are a lot cheaper! When I had my first child, childcare vouchers didn’t exist. They are a tax efficient way of paying for registered childcare. You sacrifice some of your salary for an amount of childcare vouchers. You save the income tax and the National Insurance on this amount, which effectively means that the part of your salary you exchange for childcare vouchers is tax free. The cost of these vouchers is then paid directly to the childcare provider.

A basic rate taxpayer can exchange up to £243 each month; which is £124 for a high rate taxpayer and £97 for an additional rate taxpayer.

There are of course rules with the payments, such as it has to be a registered nursery or child-minder, so although Grandparents are definitely less expensive, you cannot use the scheme to pay family members or friends to look after the children.

Although it is a very tax efficient system, you would also have to consider any benefits that you may lose or may be affected because you are in affect ‘losing’ some of your income. For example, you might lose some entitlement to tax credits or National Insurance accrual, depending on your circumstances.

All in all I found it very straightforward to set up (partly because our company is very focussed on helping working parents) and I am glad I did it.

More from our blog

  • Blog image

    We are now (scarily) in to August and every year at this time I always hope that the heat of summer will return, as today it is my birthday and I always look forward to spending some quality time with

  • Blog image

    Our newest recruit at FMB is a 21 year old local lad called Paddy who is as keen as mustard to learn the ropes within his role as Trainee Client Services Assistant. I can see he will do well here.

    I

  • Blog image

    It's all change at FMB...

    05 September 2014

    It’s all change at FMB this month! From Monday (1st September), we have made some structural changes within the company which will, in turn, affect the way that we work.

    Previously, our 10 Financial

© Financial Management Bureau Ltd 2011 - 2017. All rights reserved.
Financial Management Bureau Ltd is a limited company registered in England and Wales. Registered office: Shenstone House, Helsington, Kendal, Cumbria LA8 8AA. Registered number: 02089786