HMRC issues £2,000 'per child' reminder to parents

Parents are being reminded that they may qualify for up to £2,000 in help to pay for childcare. HM Revenue & Customs (HMRC) have urged mums and dads to check if they are eligible for the Tax-Free Childcare perk.

The scheme sees parents set up an account into which both they and the Government pay. That money is then used to pay a childcare provider. For every £8 parents pay in by Direct Debit, standing order or bank transfer, the Government adds another £2 up to a total of £500 per child every three months - totalling £2,000 per year.

If the child is disabled, this rises to £1,000 per month, totalling £4,000 a year.

Certain conditions apply, including that a parent usually needs to be in work or returning to work. The child must also be 11 years old or younger. For a disabled child, the age limit is 16.

Childcare providers must also be signed up to the Tax-Free Childcare scheme, so if you want to apply, check with them first.

The money can be used to pay for childminders, nurseries and nannies as well as after-school clubs, play schemes and holiday clubs.

The provider must be approved, meaning they must be a registered childminder, playscheme, nursery, or club.

This registration rule also applies to childminders or nannies from agencies, as well as schools and home care workers from a registered care agency.

In England, to check if a childcare provider is approved, check with Ofsted. Parents in Wales can check with Care Inspectorate Wales, while those in Scotland should search the Scottish Care Inspectorate.

Parents in Northern Ireland can check via the Early Years Teams section of the NI Direct Government Services website.

Under the scheme in England, parents' payments should usually appear in their childcare account within one working day, with the Government's top-up entering at the same time.

Parents need to check their account every three months to confirm they are still eligible; otherwise, it stops.

To be eligible in England, a parent and their partner, if they have one, must each expect to earn a certain amount before tax over three months.

For those aged 21 or over, this is £2,643.68; for people aged 18 to 20, the amount is £2,256.80, and for a parent who is under 18, they must earn at least £1,664 over three months.

Self-employed parents who set up their businesses less than a year ago can still be eligible, and it does not matter how little they earn.

A National Insurance number is also required, as is British or Irish citizenship, or settled or pre-settled status, or permission to access public funds.

Further details on how to apply and eligibility are available at the Tax-Free Childcare website.