Main changes

To summarize the main changes are:

The new Tax Free Childcare scheme, will launch in early 2017 :-

• HMRC will add 20% to deposits made

• Self-employed to receive assistance for the first time

Research shows 2 in every 3 households will be worse off under the new scheme 

• Top ups will stop following child’s 11^th birthday

• No help for additional rate taxpayer

• Both parents must be working the minimum hours

For many the Existing Childcare Voucher Scheme will be more beneficial:- 

• Both parents can access the vouchers

• Can reduce salary sufficiently to reinstate child benefit

• Open to all employed taxpayers

• Available to company directors

• Only one parent needs to be working

• Continues until after the child’s 15^th birthday

It may not be clear, which is more suitable.

Impact for clients

These changes will affect all clients:- 

• The self-employed should be made aware of the existence of the new accounts.

• Directors should be made aware that the voucher scheme is available for them to use

• Employees should be made aware of the existence of both schemes and which is best for them

• Additional rate taxpayers should be advised that they can only access the voucher scheme as the new account scheme is not available for them

• Those close to the £50k salary level where child benefit is withdrawn.  A voucher scheme can reduce salary via salary sacrifice and child benefit could be reinstated adding an extra £1,700 to the household income for a family with 2 children. 

Our Impact Review pack will help you

Our Childcare Voucher Impact Review will help you;

• Understand the issues and how to use the resource to set up and provide the review,

• Promote the issue using a news item, scripted advertising slides and recorded advert video,

• Illustrate the potential impact on clients from the changes using our calculator,

• Provide opportunity to explore ways with clients on how they could save tax,

• And the opportunity to sell your extra services, using our structured approach.

Check out our Property Impact Review pack.

Check out our Dividend Impact Review pack.

Check out our Company Car Review pack.

Which membership will suit you?