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childcare vouchers

(3 Posts)
McKitten84 Sun 11-Jan-15 07:59:13

Can someone please explain to me how childcare vouchers from your employers work? Dp is a sahd as I am the higher earner, but ds now needs some social time which we think nursery would be best. We are thinking 2 half days a week, due to cost, would using these vouchers benefit us? Thank you x

Nolim Sun 11-Jan-15 08:27:30

Vouchers allows you to pay part of the childcare tax free. So yes i think it would make chilcare cheaper.

Cumberlover76 Sun 11-Jan-15 08:35:53

Do you get child tax credits? If so use this HMRC calculator to see if you are better off buying child care vouchers. You can get up to £243 per parent (if both working somewhere that offers them), this means your taxable income is reduced by whatever amount you choose to receive so you pay less income tax (for me and dh it's around £75 each per month) but can also reduce amount of benefits received or anything based on taxable income. Child tax credits are based partly on the cash amount you pay out for childcare, vouchers don't class as cash amount so vouchers will reduce your childcare payments and therefore may reduce tax credits. Hope that helps.

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