Tax free childcare

[Waffle12]

Wasn't sure where to post this as other areas I thought might cover this are quite quiet.

We have been using childcare vouchers up to now, but DH has changed jobs and they don't offer the vouchers so looking to swap to tax free childcare.

We have 2 children, and I understand the savings with TFC are up to £500 per child every 3 months, and the top up cap is per 3 month qualifying period.

I am getting myself confused as I am used to the voucher scheme- we both got the max of vouchers and then we can allocate however we want between the bills for both children so we can make use of the maximum help.

The bit that's confusing me with TFC is that the childcare fees are very different between our 2 children. One has constant fees of about 850 per month. The other child only has costs of about 75 per month and only during term time.

I am a bit confused how and when the best way to pay into the account is. As its based on each child now, it seems to me that I would be vastly under using the allowance for one child, while we would be capped on how much help we would get for the other child. And you have to have a separate account for each child and cannot transfer funds between children.

Please don't get me wrong- I am grateful for any help we can get with childcare fees, but want to make sure we use TFC to its full potential.

Can anyone explain how I best use it? Am I better paying in monthly, or per qualifying period in one lump sum if we can afford it? With the lower fees that are only term time, am I better putting in a lump sum that will tide us over for a bit and then not pay anything in for a while or will it not make a difference?

So sorry if I am making this way more complicated than it is . Any advice greatly received.

Thank you.

I have done both ways and it all works out the same: you see your money go in then the HMRC top up.
At the moment I am just transferring in monthly as we are paying more variable amounts in the coming months.

I just transfer the monthly bill amount in -20% then once the top up is added it’s the right amount to pay the setting.

I think you’re overthinking this. We’ve never had vouchers so can’t compare, but you’re right there is only so much per child per quarter.

When I get an invoice, I take 80% of the total amount and pay that in. The other 20% magically appears usually a few minutes later, then I pay the invoice for the full amount. I do this monthly for child in nursery, per invoice for one that uses holiday club (sometimes this is for just one week, sometimes for the whole summer, depends on invoice). That’s it. Really easy. But you’re right you can’t allocate more funds to the more expensive child.