Childcare Vouchers-how to make employer join scheme?

[majorstress]

has anyone managed to do this??? please relate your experiences!!! I just found out that the employer gets some cash too, surely it is worth it for them?

[majorstress]

any ideas to try out, even?

[MrsBigD]

As far as I know it's worth it for them too because they don't have to pay NI on that amount.

I'm just talking to my boss about it - we're a small co.. 9 people incl. cleaner and security guard and are using an external accounting company who will be sorting all that out for us.

Tell your employer to read through this site might give him/her some insight

[Blu]

MrsBigD: see my other thread about this - if you work for a small organisation, they might prefer to pay the nursery direct rather than subscriv=be to a voucher system - esp if not many people will be taking advantage of the scheme.

under ACCOR and other voucher companies, the employer has to pay an admin fee - which is only slightly less than the NI saving. If they pay the nursery direct, the employer saves the whole lot!

[MrsBigD]

blue would that apply for nannies/childmiders as well?

[Blu]

I guess so.

It's so bloody hard to find all the right onfo on this.

[majorstress]

sorry to start another thread but it's a different angle-this whole scheme involves the carer, the parents and the parent's employers starting a whole complex learning curve, not to mention the middleman companies. It's really quite complex isn't it? and no one place or person knows all the answers, because it just started.

[LunarSea]

Mine do it, and have done since before we had ds. DH's employers we're still working on. At the moment we're stuck at the "HR say there's no demand" stage - well how do they know that? Most parents probably aren't aware of the scheme, so it's hardly surprising that they're not queing up to request it. It's HR's job to know about that sort of thing isn't it? Have been emailing people know to have kids/childcare and whipping up support by getting people to request it from HR so hopefully they may eventually concede.

The Daycare Trust have some good factsheets for employers which might help you.

[majorstress]

Thanks, I thought HR should be more helpful too-but mine actually was, that is how I even knew about it before April 6-just didn't sort it out as so confused. It's probably DH's lack of drive in this matter-it is pretty boring isn't it, money, rules, and forms? Maybe I should price up something like a climbing course he wants to do and say, when you sort our your vouchers, you can book it because you have already paid for it!

Gawd. Bl*dy kidz...

What will I spend MINE on...hmmmm! Motivate motivate motivate....

[jothorpe]

Care4 say it's not viable to administer a scheme for less than 1000 employees.

Anyone know of any voucher providers who will manage a scheme for a small business?

[LunarSea]

workingfamilies.org.uk have a factsheet for small and medium enterprises which suggests Accor, Leapfrog and Busy Bees, so those presumably do?

[jothorpe]

Thank you for that, I have contacted all three of those making enquiries.

[alibubbles]

I work for 4 teachers at an independent school.I got them to set up the scheme with busy bees. I have been paid with vouvhers for 3 years ( actually they credit my bank account direct now). I have also just received notice that I have been paid 4x £217 so must now ask families to give me a cheque for the balance and set up a standng order.

BB were very helpful and caled the school and talked them through it, as there is a bit of a crusty old bursar resistant to change, but he did it!

[majorstress]

So, it's not true about needing 1000 employees?

Does anyone have any other experiences of other companies besides busy bees in terms of assisting in bullying employers? This is really interesting! (well, relatively speaking....)

[MissChief]

accor in my experience seem bit more efficient than busy bees - they'd do a sales pitch for you anyway, do publicity to staff etc. It IS a hassle for employers initially in terms of paperwork etc (however much voucher companies say straight-forward and they'll do it all for you). it would get your co brownie points though in terms of being a model, family-friendly employer though and should give savings in terms of reduced turnover costs from (hopefully) retaining more staff after mat leave etc. could you/someone in yr HR put a short business case to yr co for implementing vouchers? accor website cites lots of egs of companies who've introduced the scheme.

[majorstress]

I cannot believe they have called themselves busy bees-my dds already attend 2 different places called busy bees, it is confusing us no end already -this will be the final straw!

[majorstress]

I cannot believe they have called themselves busy bees-my dds already attend 2 different places called busy bees, it is confusing us no end already -this will be the final straw!

[Azure]

Sodexho and Kidsunlimited are other agencies that deal with childcare vouchers. The fee charged by the agencies is around 5%. As the NI saving to the employer is up to 12.8% (depending on the type of pension scheme), the company can make quite a saving.

[Caligula]

This is a timely thread, I've got a meeting next week in which I'm raising this as an issue for my employer.

This bit in the information for employees and employers struck me:

"Generally, if you are getting more than £545 a year in total from Tax Credits, you will not gain from claiming the tax and NICs exemptions -- unless you are a higher rate tax payer."

So it looks like you need to speak to the IR about how your tax credits will be affected before you decide to enter the vouchers scheme - you may be better off sticking to tax credits.

[LunarSea]

Caligula - actually that's a bit of a generalisation. If you are paying more per week for childcare than the maximum for Tax Credits (£135 for 1 child/£200 for > 1) then it probably still helps you, as the vouchers show as a reduction in income, but not a reduction in eligiable childcare costs IYSWIM, and could therefore actually INCREASE the amount of tax credits you get.

[Caligula]

Yes, it is a generalisation LS, but it's one they make. I think anyone considering it should probably ring the IR helpline and just make sure that it is worth their while. It specifically says that they want to make sure you're not claiming childcare benefit twice, once via the vouchers and once via the CTC. Unless I'm being thick and misunderstanding what you're saying? I'm trying to work out if I'd be better off with the vouchers, and it looks like not, but I can't be arsed to phone the helpline at the moment - am hoping someone here will post a gem of wisdom that will save me bothering to talk to the IR. I seem to almost be personal friends with them, I speak to them so often!

[LunarSea]

Caligula - Ok you want maths, you've got maths...

£50 of vouchers saves you 22% tax and 11% NI for most people (depending upon the highest rate you pay tax at, whether you're contracted out of SERPS, and whether you're over the NI threshold). If you're getting more than the basic £545 a year in credits then it's a fair bet that that's your tax situation, so the saving is £50 x 33% per week - i.e. £16.77

BUT.... If your childcare costs were already within the maximum then the amount of potential credits you'd be eligable for would go down by 70% of £50/week - i.e. £35.

However the income the credits are assessed against would go down by £50/week - which would actually increase your CTC entitlement by 37% (the withdrawal rate) of £50 = £18.50

So overall not a lot in it - better off by about 27p a week I make it - which isn't really any gain if the vouchers are part of a salary sacrifice and hence affect company pension contributions or SMP entitlement.

Basically if you are only paying the 10% tax band, pay a reduced rate of NI, or have an income of less than about £141 a week you'll be worse off having vouchers. If you're Mr/Mrs average on the basic rates of tax and NI, but receive over £545 a year in CTC there's no difference. Anyone else, you gain.

However the income level at which you go down to the basic £545 CTC isn't that high in terms of 2 earner families (don't have up to date figures but IIRC it was about £42k with 2 kids and max childcare last year) so there will be a lot of people who fit into that "gain" category.

[Caligula]

Wonderful! Thank you very much LS - saves me a call! Isn't Mumsnet a great resource?

Can I just do a quick hijack about this and ask you if you know what the formula is for working out how much tax credits you get? I can never find any info about it, and the one time I asked the helpline, the poor lad had a bit of a turn, so I haven't dared to ask since.

[LunarSea]

I don't have it as a formula as such, but I do have the figures/rules to calculate it. Need to do some work now (shock, horror!) but I'll try to dig them out and write them out in a way that you could use as a formula later.

[LunarSea]

Now have an online calculator for CTC for this tax year - will try to upload and link to it later (prob tomorrow).