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Switching from childcare vouchers to tax free childcare(15 Posts)
I know there are tons of threads on tax free childcare but specifically, has anyone made the switch from vouchers to the new system and how have you found it if so, especially with how you timed setting up on the new system and quitting your voucher provider? Looking at doing it for around October/November when I go back on maternity. Both using the full £243 allowance atm but obviously I'll lose mine while on SMP (thank you, 2015 case ).
How many children do you have at the moment? It may not be worth doing TFC until you have several qualifying children.
Don't know if of anyone who has switched, very early days for TFC - they are in BETA and some functionality is still not working.
Just the one atm. DC2 will then be in nursery with DC1 when I go back after this mat leave. Doing the maths, switching would leave us better off from mat leave onwards - hadn't previously thought we'd need to weigh it up until I was heading back to work. The reported teething problems make me hesitant, but then I understand we'd have three months once registered to quit the CCV schemes, so theoretically our worst-case would be staying on the (slightly less cost-efficient) CCV schemes a touch longer than we'd prefer until everything was in order?
My understanding is the same, you could have around 3 months where there is an overlap, so getting vouchers plus the top-up on anything you pay into the childcare account.
When you go back to work after maternity leave TFC I expect is better. Whilst on leave, I'm not sure how long you can pay in to the account without having a childcare cost. Maybe for three months, maybe a year - I don't know. Your older child could still have some childcare cost whilst you are on maternity leave though you may cut down childcare completely during your maternity leave.
Each quarter, each child (if not disabled) can get £500 top-up. So £2000 in during three months, £500 top-up. Least that is my understanding of how the top-up works. How it works in reality I would love to know. Does that make any difference to your math? Probably not but may depend on the amount involved.
I'm in the same situation, my DS is still in nursery while I'm on maternity leave so I've set up TFC now as my vouchers have stopped. I haven't actually cancelled my vouchers yet, when you sign up to TFC you agree to cancel them within 90 days. I tried to do it online but it has to be done through your employer. TFC has been easy so far, no problems. My vouchers stopped a month before I signed up, but I think you can overlap as long as it's within the 3 months
If you currently have salary sacrifice childcare vouchers you need to check the terms because there is a loop hole where they get paid through maternity leave but can't be deducted from smp/unpaid leave so you effectively get £243 a month of free childcare! (Some workplaces have put a clause into terms and conditions to say you won't claim whilst on leave)
If you are covered by this it won't be worth switching until after you return from maternity leave
1981 The loophole closed last year (sounds like it shouldn't necessarily have but there we are): www.tax-free-childcare.info/2016/05/childcare-vouchers-during-maternity-leave/
Acorn, thanks. Have you started paying in yet?
nannynick thanks also. DC1 will stay in nursery on reduced days, hence considering it now. It wouldn't represent a massive saving over CCV but if it's not going to make me throw myself out of a window, I figure it's still a cost we can save.
V interesting about the overlap, tho. Thought that sounded too good to be true but perhaps not!
Check also because my understanding is once you leave the voucher scheme you can't rejoin as ultimately they are trying to phase it out.
That's correct. As we'll have two in nursery (and then potentially breakfast and/or after-school clubs), we should remain better off. CCVs continue until the child reaches 16 and TFC cuts off at 12, but we are an extremely long way from that and I'd be amazed if I for one am still with the same employer that far down the line.
Yeah I've paid into TFC, just made a card payment on the website and then select the nursery from a list to pay them. I'm presuming nursery received the payment, they haven't mentioned it.
Good to hear that people have started to use this. We have vouchers but wary of switching over yet as it was such a faff sorting out the 30 hours!
I switched over from vouchers as I have 2 in childcare and hubby didn't get the vouchers so much better for us. Was simple. In June I even made payments half in vouchers and half in TFC and my nursery were fine.