Participating in a childcare voucher scheme could affect the amount of tax credits a parent is entitled to, particularly if a parent gives up some of their salary to join an employer’s childcare scheme.

Parents cannot include the childcare costs met by an employer, either directly, or through childcare vouchers, on a tax credits claim.  This is because the tax and National Insurance exemptions amount of £55 week (£243 month) is considered a childcare benefit in kind.

If parents are not sure whether to take advantage of an employers childcare support scheme they should

visit www.inlandrevenue.gov.uk/childcare or www.taxcredits.inlandrevenue.gov.uk

or alternatively call the tax credits help line

GB: 0845 3003900 (text phone 0845 3003909)

NI:  0845 6032000  (text phone 0845 6076078)