Help with childcare costs

Whether you have a small child or a hulking teen, the costs of childcare can be huge. Yet 100,000s of working parents are missing out on £1,000s of help with these costs. There are a range of schemes that can help, but some let you save more on childcare than others. Here we run you through all your childcare options and where to start.

You can get financial support for children of ALL AGES – not just young ones

The term 'childcare' may conjure up an image of a young child at nursery. But as many of you will know, the need to pay for childcare doesn't necessarily stop when your children go to school.

The good news is that there are schemes that cover children at different ages, depending on your family’s circumstances:

  • If you've a two, three or four-year-old 'free' childcare could be available. Parents across the UK can get up to 30 funded hours a week. But beware, the actual government funding entitlement is for 1,140 hours a year. This means that for a full 30 hour week, funding will only cover 38 weeks. To work around this, many providers stretch their funded hours by offering fewer a week over the year, with parents paying the shortfall.

    Many parents of two-year olds in England will also get some funded nursery hours, which will kick-in the term after they turn two. 

  • If you're on Universal Credit and in work, you can reclaim some of your childcare costs – up to a maximum of £1,014 for one child and £1,739 for two or more children – for children up to the age of 16. You can claim just during school holidays, or throughout the year.

  • If you're on Tax Credits, you can claim Child Tax Credit until the next 31 August after your child turns 16.

  • If you're not on benefits but entitled to Tax-Free Childcare, you can get a top-up of up to £2,000 per year, per child until the 1 September after your child turns 11 (or 16 for disabled children – and for them you can claim up to £4,000).

  • If you're still able to use Childcare Vouchers, you can use them until your children turns 15 (or 16 if they're disabled). 

As you can see, there's a range of schemes designed to help working families with the cost of childcare. But not all are equal – some will help you save more than others. And remember that in all cases, you need to use a registered provider (see below for how to find one near you).

Consider the options in the section below to see which apply to you. We've listed them in the order you should consider them to make sure you're getting the maximum possible help with your childcare costs...

Quick questions

  • How do I find a registered provider?

    No matter which of the above schemes you use, if you're getting help from the government, you'll need to choose a provider that's been checked, approved and registered by the relevant regulator. It's quick and easy to find a registered provider near you and/or check that a provider you've chosen is registered:

    • England and Wales: 
      - All childminders must be registered with Ofsted or an Ofsted registered childminding agency. Find a registered childminder
      - Other childcare providers must be registered with either Ofsted's Early years register or its Childcare register. You can check here.

    • Northern Ireland: All providers must be registered with the their local Health and Social Care Trust. Find an approved provider.

    • Scotland: Childminders and childcare providers must register with The Care Inspectorate. Find a registered provider.
  • Can I get help for extra costs during school holidays?

    School holidays can be hard for working parents. But, in addition to the schemes mentioned above (all of which can be used during school holidays), there is additional support available for some.

    If you're on certain benefits, you could qualify for additional childcare help over the school holidays. We cover what's available across the UK in our Free school meals and holiday help guide.

    If you don't qualify for benefits, there are still ways to get free or cheap childcare over the holidays. Check out our 11 tricks to get school-aged kids looked after for less. We've also got a list of ideas and offers for ways to keep children entertained.

  • Can I get help for after school care?

    As long as you get your childcare through an approved, registered provider, you can claim back after-school or school holiday costs in the same way you normally would. This can include different types of childcare – such as childminders, play schemes, nurseries and clubs (including clubs and camps that run over the holidays). 

    If you ask, most providers will simply tell you if they're registered. You can also find out from your local authority's children's services department or search for your nearest family information service on the Family and Childcare Trust website, which should be able to tell you about the provision available in your area.

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1. 'Free' childcare for three or four-year-olds (and some two-year-olds)

Before you pay for ANY childcare, check if you can get up to 30 funded hours each week.

If your child is three or four-years-old, there are funded hours of education and childcare available across the UK (starting from the term after your child's third birthday), and for two-year-olds in England. How it works depends on where in the UK you live – England's below, or jump to Wales, Scotland or Northern Ireland info.

How government-funded childcare works in England

Currently, in England, you're entitled to 570 hours of government-funded childcare a year. This is usually taken at up to 15 hours a week for 38 weeks of the year. You can stretch it out longer by using fewer hours a week, but many councils want your child to attend for at least 2.5 hours a week.

You can either use this allowance in school term time, or you can usually use it over the entire year. To get it, simply ask your local nursery or childcare provider if it has space. You must tell it that you want to take advantage of the 15 funded hours when you sign up.

Some parents can get 30 funded hours' childcare a week

Parents of children between the ages of three and four can get an additional 15 hours of funded childcare a week (totalling 30 hours a week or 1,140 a year), if they work and meet certain conditions. 

Councils should have their own cut-off points for application on their websites – typically these are 31 December for the spring term, 31 March for the summer term and 31 August for the autumn term.

To qualify for the extra 15 hours of funded childcare, you must

This applies to both parents in a couple (so each parent must fit the criteria) as well as to single parents.

So, a parent couple each earning £100,000 would still get the extended 30-hour allowance (but not £100,001). But, if one parent doesn't work, your child would get just 15 funded hours.

To get the the first 15 hours, you just contact the provider. However, for the extra 15 hours, you need to apply for the extra hours' funded childcare through the Gov.uk website. If you're approved, you'll receive a code to give to your childcare provider. You'll get the extra hours once the next term starts.

Even if you get 30 funded hours, you still might have to pay 

Since government funding is actually 1,140 hours of childcare a year, this means that for a full 30-hour week, the funding will only actually cover 38 weeks. To work around this, many providers stretch their funded hours by offering fewer hours a week over the year. Providers are also entitled to charge for extras such as lunches and nappies. 

New: Younger children in England now get some funded hours too

Eligible parents of children aged two now also have access to 15 hours of funded childcare. This will be expanded to children aged nine months and up from September 2024, and increased to 30 hours of funded childcare from September 2025 – see the table below. 

If you already claim Tax-Free Childcare you'll get sent a code to claim your funded childcare hours when you reconfirm your eligibility. 

Government-funded childcare hours in England

TABLE_CELL_STYLE What 3-4 year olds get What 2 year olds get What children aged 9 - 23 months get
Now   All get 15 hours, some get 30 hours if eligible

15 hours if eligible

None
From Sep 2024 15 hours if eligible
From Sep 2025

30 hours if eligible

TABLE_CELL_STYLE

30 hours if eligible

How funded hours works in Wales

Parents of three and four-year-olds across Wales are entitled to up to 30 hours a week of funded childcare, across 48 weeks of the year. You can divide the hours up, but at least 10 hours a week needs to be used on early education and 20 hours on general childcare.

To qualify, you must...

This applies to both parents in a couple (so each parent must fit the criteria) as well as to single parents. If you don't meet the 'working parent' criteria, you won't be eligible for any funded childcare hours. 

Before you apply, check that your chosen childcare provider is registered with the Care Inspectorate Wales.

To apply, contact your local family information service or see the Welsh Government website for more information. 

How funded childcare works in Scotland

All three and four-year-olds are entitled to 1,140 hours a year. What type of provider is eligible, and when and where you can take your hours, varies by local authority. You can also get help with childcare for your two-year-old if you receive a qualifying benefit.

To get it, speak to your local authority, or you can contact your childcare provider to see if you can use your free allowance with it. Or you can also use the Scottish Government's Parent Club.

How funded childcare works in Northern Ireland

Three and four-year-olds get a funded pre-school education place through the Pre-School Education Programme, available term-time either on a full-time or part-time basis. Full time amounts to 4.5 hours a day (22.5 hrs/wk), and part-time 2.5 hours of free childcare a day (12.5 hrs/wk) for 38 weeks of the year.

To get it, go to the Education Authority's website to get an application form. You can apply to any number of providers, but it's best to select more than one, as your chosen provider might not have enough spaces available.

You have to supply the form and your child’s birth certificate to your first preference childcare provider by the deadline. You can find all application deadlines on the Education Authority’s website.

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2. Check if you can get benefits to help with your childcare costs

If you're on a low income and the free childcare hours scheme either doesn't apply to you, or won't cover your full childcare bill, your next port of call is to check whether you can claim extra support through Universal Credit (UC). If you're eligible, this will likely cover more of your childcare costs than Tax-Free Childcare (which we cover in step three).

Our general rule is: if your household income is under £40,000 (or possibly even up to £50,000 if you've a larger family, especially if you also pay high rent for your home), then it's worth checking if you can get Universal Credit. You can get a quick estimate of what you might qualify for with our 10-minute benefit checker

If you qualify for UC, you'll get what's called the 'child element', worth around £288 per child per month on top of your standard allowance. To read more about eligibility and how Universal Credit works, see our Universal Credit guide. 

And, if you're in work, you'll also be able to claim back up to 85% of your childcare costs...

In work? Get help with 85% of your childcare costs through UC

If you're in work, paying for childcare (including nursery, preschool, after-school clubs, breakfast clubs, childminders, nannies, and school holiday clubs) and claiming UC, you can claim back some of your childcare costs via your online Universal Credit account

But you must get your childcare through an approved, registered provider. If you live with your partner, they'll also have to be in work, or be classed as having a 'limited capability for work' by the Department for Work & Pensions.

You can back up to 85% of your childcare costs, no matter how many hours you work. You can get a maximum of £1,014 for one child and £1,739 for two or more children. You'll need to provide evidence of your costs, such as: a letter from your registered childcare provider, a bank statement proving you've paid your provider, or a cash payment receipt.

You can make a claim up to three months in advance but, unless you meet the criteria below, you will only get the money after the childcare has been provided. This means even if you pay in one upfront sum, you may get the money paid back to you in smaller instalments over a few assessment periods.

Claim costs in advance if you're 'significantly increasing' your hours 

A new feature of Universal Credit is that if you move into work or 'significantly increase' your hours, you can be paid a month of childcare costs upfront. The Department for Work and Pensions told us there is no minimum number of hours but work coaches may expect at least a few more hours of work every week.

  • If you're entering work: once you know your start date, you need to find a childcare provider, get the approximate monthly cost, then submit this via your journal, you will then get the 85% of the first month credited to your account upfront. 

  • If you're increasing your hours: once you know what your next childcare bill will look like, you need to speak to their work coach (via their journal or in person) to start the process.

Scottish resident on low income? You can get extra help

If you’re a Scottish resident on a low income, and look after a child under 16, you may also be able apply for the Scottish Child Payment (£26.70 a week).

To qualify, you must be claiming one of the following benefits:

  • Income Support
  • Income-based Jobseeker’s Allowance
  • Income-related Employment and Support Allowance
  • Pension Credit
  • Child Tax Credit
  • Working Tax Credit that includes a disability or severe disability element
  • Universal Credit

If your claim is successful, you'll get the payment every four weeks until your child turns 16. 

You can apply online using this form. Head to our maternity grants guide for more detailed information on the scheme.

Still claiming Tax Credits?

If you're still claiming Tax Credits, rather than Universal Credit, you can get help with up to 70% of your childcare costs (paid directly into your bank or building society account each week or month). You may be better off switching to Universal Credit, but there's a lot to consider first.

Our Switching to Universal Credit guide covers key things you need to know.  

3. Check if you qualify for Tax-Free Childcare

Important: If you claim Universal Credit or Tax Credits, you WON'T also be able to use Tax-Free Childcare. Opening a Tax-Free Childcare account will mean you stop getting paid your benefits. 

Below we explain how Tax Free Childcare works, but first a quick word from MSE founder Martin Lewis...

Tax Free Childcare is appallingly named, DON'T let it confuse you. 

Calling the scheme ‘Tax Free Childcare’ was a political spin to ensure government gets credit for the scheme. Unfortunately the name is appallingly confusing and misleading, and probably partly responsible for the scheme having a much lower take up than it should have.

In effect this is a discounted childcare savings scheme. Where you save and then pay for childcare with a 25% top up. It's not about tax in anyway – and isn’t linked to the tax rate you pay.  It should change the name to something like “Help for Childcare” or something far better.

Even if you’re not entitled to benefits, you might still qualify for Tax-Free Childcare instead.

Tax-Free Childcare is a Government-backed scheme which helps working parents with the cost of childcare. The scheme, which launched in 2017, gives eligible families an extra 20% towards their childcare costs.

Tax-Free Childcare is designed so that for every 80p you put in, the government will add 20p – so it effectively gives you basic-rate tax back on what you pay (hence the scheme's name).

You can use the scheme to pay for up to £10,000 of childcare per child each year – meaning you'd pay up to £8,000 and would get up to an extra £2,000 per child each year. If your child is disabled, you can get up to £4,000 extra a year.

You need to be in work to qualify and earn £100,000 or less – this includes those who are self-employed. Tax-Free Childcare is available to both single parents and couples, but if you're in a couple, both you and your partner need to be in work to qualify, and both need to earn £100,000 or less individually.

Once your childcare bill exceeds the Government maximum, there's no more financial support for that year. You can still pay for your childcare through the scheme but you won't get a top-up, so it can be easier just to pay for your childcare directly once you've hit the limit.

The scheme's available until the 1 September after your child turns 11 (or 16 for children with disabilities). See full info in our Tax-Free Childcare guide. 

Childcare Vouchers

Some parents can also use Childcare Vouchers, which allow you to pay for childcare from your pre-tax salary. The scheme closed for new applicants in October 2018, but if you were signed up before then, are with the same employer, and it still offers them, you can continue to get these. 

What works out best will depend on your personal circumstances. But you have to settle for one as you can't use both at the same time. For full info, see our Childcare Vouchers guide.

In addition to the options outlined above, many people with parental responsibilities are entitled to further help from the Government – see our child benefit guide for more details. 

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