Tax-free childcare scheme: You may now be eligible

As a result of COVID-19, you may now be eligible for the tax-free childcare (TFC). The government has brought in temporary changes to its TFC scheme, potentially giving more people access to 30 hours free childcare.Are you now eligible for the tax-free childcare scheme due to COVID?

Basic requirements for eligibility:

1. You must expect to earn at least the equivalent of the national minimum wage or living wage over the next 3 months. This equates to £1,813.76 per month for an over 25-year-old.

2. If you have a spouse or partner they need to earn this as well.

3. If you are newly self-employed and your earnings are not at this level yet, don’t worry you can use your expected year’s earnings instead.

4. There is an upper-income limit too. If you or your spouse/partner have ‘adjusted income’ in excess of £100,000 in this tax year you will not qualify. Adjusted income is your total income before you deduct your personal tax allowance or take off things like your gift aid.

Who could benefit from these temporary changes?

  • Those furloughed
  • Those not able to work as much as normal
  • The self-employed 
  • If you are working more than normal because of COVID-19
  • Critical workers

For those who have been furloughed if your current income does not qualify you for TFC, your normal income can still apply.

What about if you have taken unpaid leave to care for your children or someone with COVID-19?  

You too can apply if your normal post COVID-19 income meets the income requirements.

If you are self-employed and still working, or not able to get work because of COVID-19 you can apply for TFC, and use your expected income in the current tax year if within the qualifying boundaries.  

Attention critical workers

One of the best developments is that critical workers who have earned more than the £100,000 usual limit because they have had to work more because of COVID-19 are now eligible. Additionally, any critical worker who missed the 31 March reconfirmation or application deadline can still apply.

Claim the help you deserve

COVID-19 has taken away lots of our parental choices. However, thanks to some government assistance a greater number of people will now qualify for help with the costs incurred due to the current coronavirus crisis.

There is more information on the government website, where you can check if you can get Tax-Free Childcare and 30 hours free childcare during coronavirus (COVID-19).


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