If you have childcare costs, or feel you can't work because of childcare costs... come over here!

[HeirOfSlytherin]

This is my public service announcement. I have given advice previously to individuals, but never written a post about it. I have seen so many people saying they earn too much to get help with childcare, but this isn't always the case.

Under Universal Credit far more families are entitled to some payments towards their childcare costs than even realise it. As an example I am a band 6 NHS worker earning 25k PT, and my partner is a teacher on 30k. I have 2 children, one with a disability (high rate dla) and childcare costs of £300 per month. We receive £285 in UC each month.

Here is an example for a couple with 2 children and childcare costs of £300 per week living in a mortgaged property.

Take home pay of £4000

UC elements of couple over 25 - £525, eldest child born after 2017 £244, younger child £244, carer element £163, childcare cost £1108 for 2 children in childcare (they use 85% of your costs to make up the element).

Added up is £2121

The way it is worked out is that you take off a work allowance from your take home pay - so in this case as they have a mortgage the work allowance is £573. Take this off the combined income of £4000, then the income used for calculation is £3427.

Then you divide this by 100, then x 55 which is the taper rate. This equals £1884. This amount is then taken away from the £2121 which is the maximum UC they would be eligible for. So the total UC payment would be £236.

Another example using the same scenario but adding in the fact there is a disabled child who gets high rate dla, this adds 2 elements- disabled child element of £414 and carer element of £163. This would now change the max UC to £2698. The taper rate calculation would be the same, thus 2698-1884 = £814 UC payment.

Another calculation with a couple over 25, 4 children, 3 of which born before 2017, 2 in childcare, rent of £1000 per month which is equal to the LHA (local housing allowance for the area).

Take home pay £5000.

UC elements of couple over 25 - £525, eldest child born before 2017 £290, second child born before 2017 £244, 3rd child born before 2017 £244, no element for youngest child as born after 2017, childcare cost £1108 for 2 children in childcare, rent element £1000.

As this couple rent, the work allowance is lower - £344. So £5000 - £344 = £4656.

Maximum UC would be £3411.

Taper rate of £4656 / 100 x 55 = £2510.

£3411-2510 = UC payment of £900.

I appreciate the sums could look complicated, but I wanted to make those of us who are "middle earners" stop and think if they may be financially better off either by claiming UC when they aren't already, or going back to work because they believe they wouldn't get any help.

Happy to try and answer any questions, but I'd direct most people to this Facebook group as the admin are far more knowledgeable on specialist areas such as disability, students, etc www.facebook.com/groups/1824855797785386/?ref=share. I'm not admin but have been on that group for about 6 years and offer help where I can.

I really hope this helps at least one family out there 😊.

@HeirOfSlytherin

I never knew you could do this. I tried to follow but did get lost in the figures halfway through, though that might be me being slow to catch on at such a late hour! Ha ha.

Our combined income is identical and we’re reaching the stage where we are thinking of DC in the next couple of years. Being preparers in nature we have thought about what possible childcare costs might be to see when it will be feasible. We wouldn’t need full time probably 3-4 days per week eventually.

On a combined 55k both working full time, would we be eligible for any UC? I was under the distinct impression it would only be people earning much less or not working full time. Amazing news if there will be anything we can claim and makes our super-advance budget making easier!

I tried the calculator on similar salaries and I'm never entitled to anything other than bog-standard child benefit.

I can attempt a calculation for you, but will need personal info such as what you each take home after tax and NI, rent or mortgage, what you estimate childcare costs to be (will massively vary from area to area), would you want to continue working full time or would your wage drop? Pm me if you don't want to share personal info on here.

It really does depend on which of the elements of UC apply to you, so it can vary massively case by case.

@HeirOfSlytherin I’ll DM.

Absolutely agree with this post and hope it helps others.
What I will say is, make sure you keep one month’s worth childcare in savings at all times. Sometimes your childcare costs will overlap with your UC assessment period, so you might have 0 paid one month but 2 reimbursements the next.

My partner earns £75k a year and I earn £13k (I'm part time) monthly we take home £5000 between us but I'm guessing we wouldn't be entitled to anything towards childcare because he earns over 50k? We even have to pay back our child benefit after this tax year so I will have to stop applying for it in April.

It depends on which of the elements you would have. It is possible as you can see from above figures that a take home pay of 5k could indeed see some UC in payment still. The more children you have, the higher the rent, and higher the childcare cost is the more likely that is though.

Your partner earning over 50k doesn't mean you can't get help through UC, so don't worry. It would depend on other factors like if you rent, any disabilities, how many children, what the childcare costs are etc.
It is relatively easy to work out manually. This is the link to the rates for each element www.gov.uk/universal-credit/what-youll-get If you rent you will need to work out how much local housing allowance is in your area, to see how much you can include for the rent element. This is the link lha-direct.voa.gov.uk/search.aspx

You likely get help because you have an extra element of over £400 for higher disabled child element and carers element, making almost an extra £600 on your total UC. Most parents will not have this! Of course it's always worth checking especially since the work allowances went up in the last couple of years. I agree that many people with high childcare costs may be missing out, but people with a couple of kids born after 2017 when the child element is lower and those who have a mortgage so don't get a rent element are less likely to get help.

Having more children does not mean a higher chance of getting UC unless they were all born before April 2017 because that is when the 2 child limit came in and any children born after that date only get the lower child element. And a higher rent does not necessarily mean more UC because UC will only pay up to the local housing allowance that you are able to claim if private renting. All elements are reduced by earnings after the work allowance is deducted.

People also need to realize that if you also get other childcare help like early years grant or 30 hours free childcare, you can only claim for whatever you pay above this obviously.

And anyone with savings over 16k is ruled out of claiming at all, so anyone trying to save for a house and having savings over 16k cannot claim. Any savings over 6k and up to 16 k will reduce any Uc award by around £17 a month for every £1000 over 6k.

I'd agree OP I'd have to earn £3.1K a month to get no UC this is higher in summer etc when childcare costs increase.