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AIBU?

Share your dilemmas and get honest opinions from other Mumsnetters.

Original poster

Avoiding the childcare trap

404 replies

Difficultquestionplz · 22/03/2025 05:06

hi! I know there are a lot of high earners in this group so maybe other mums can help me. I am caught up in the 100k childcare trap.
back in the days when my salary was around the 100k mark, I was able to top up the pension, but that was before my child was born. Now my child has turned 3 and was hoping to finally get a little relief but it looks like it’s not the case…
currently my salary is higher, almost exclusively due to sales commissions and I am going to finish the fiscal at 260k. My husband is livid that he loses on benefits because of my salary and I am actually wondering if there is anything I could do in terms of investments that can be deducted that could bring me below the threshold.
I am not using any financial advisor because honestly when I looked into it they wanted to take 3% management fee just to manage the easy bits (pension, isas) and it obviously compounds.

thank you for helping
(please be kind, I don’t come from money, my job is paying well now but also highly at risk due to performance management or constant layoffs mixed with the joy of nepotism, unconscious bias/ blatant sexism of a male dominated environment)

OP posts:
JaninaDuszejko · 22/03/2025 06:52

Undeneath this ragebait post is a sensible point. There does need to be a sorting out of the benefits and tax system to stop the cliff edges. And if you can pay less tax by using salary sacrifice to lease an expensive car then why on earth should you get taxed on childcare costs when that is essential to work?

GRex · 22/03/2025 06:52

The 15 hour cost is about £4k-£8k/ year; with some perspective you can see this is a tiny proportionof your salary and really not worth fretting about as it is only for one year. Best thing to do is to pay your DH this amount from your own salary; lots of couples share money due to sharing a life together and it's particularly important to do if the other person is losing out on benefits, pension or other income solely due to the relationship.

Devilsmommy · 22/03/2025 06:54

ilovesooty · 22/03/2025 05:26

You're not caught in the 100K trap.
You earn way over that.
I see no reason why you should be able to manipulate your finances to claim any free hours of childcare.

1 million percent this. Bloody hell you're asking for it starting this thread🤣

countrygirl99 · 22/03/2025 06:55

Don't have kids if you can't afford them/want to spend your enormous stash looking after them.
Or drink prosecco instead of champagne.
Go to Pontins instead of the Maldives
Etc.

countrygirl99 · 22/03/2025 06:55

JaninaDuszejko · 22/03/2025 06:52

Undeneath this ragebait post is a sensible point. There does need to be a sorting out of the benefits and tax system to stop the cliff edges. And if you can pay less tax by using salary sacrifice to lease an expensive car then why on earth should you get taxed on childcare costs when that is essential to work?

This is nowhere near the cliff edge. This is sailing far out to sea.

Badgerandfox227 · 22/03/2025 06:55

This has to be a troll, no one earning £260k cares about 15 free hours childcare.

charmanderflame · 22/03/2025 06:56

Oh come on OP. You earn £260k. You don't need help to pay for childcare.

charmanderflame · 22/03/2025 06:57

JaninaDuszejko · 22/03/2025 06:52

Undeneath this ragebait post is a sensible point. There does need to be a sorting out of the benefits and tax system to stop the cliff edges. And if you can pay less tax by using salary sacrifice to lease an expensive car then why on earth should you get taxed on childcare costs when that is essential to work?

Even if there wasn't a cliff edge, OP would be long past the point where any help would be given (and rightly so).

HavanaMoon · 22/03/2025 06:57

I was brought up to be totally independent wherever possible. State funded facilities are for those who cannot afford to pay for benefits. With your salary I would be putting my child into private day care and then into a private school to give them the best start possible in life, not trying to dodge tax obligations.

NamechangeRugby · 22/03/2025 06:59

JaninaDuszejko · 22/03/2025 06:52

Undeneath this ragebait post is a sensible point. There does need to be a sorting out of the benefits and tax system to stop the cliff edges. And if you can pay less tax by using salary sacrifice to lease an expensive car then why on earth should you get taxed on childcare costs when that is essential to work?

I don't think leasing a car via salary sacrifice, nor indeed private health or dentistry, counts to reduce your tax or lower your income for child benefit/child care purposes.

Op - if this is real, just make good to your husband whatever he loses out on because of your salary. Plenty of men do that, why shouldn't a woman if the roles are reversed?

WarriorN · 22/03/2025 07:01

Is this a real situation? Or a journo? Genuinely trying to understand. The next thread on my app was this from yesterday

Avoiding the childcare trap
NamechangeRugby · 22/03/2025 07:01

NamechangeRugby · 22/03/2025 06:59

I don't think leasing a car via salary sacrifice, nor indeed private health or dentistry, counts to reduce your tax or lower your income for child benefit/child care purposes.

Op - if this is real, just make good to your husband whatever he loses out on because of your salary. Plenty of men do that, why shouldn't a woman if the roles are reversed?

Show quote history

PS I could be wrong about that first bit. I'm curious if anyone knows?

londongirl12 · 22/03/2025 07:04

You’re trying to hide your salary so you can get some government benefits? Oh come on, who actually is that tight.

Goldbar · 22/03/2025 07:06

The only circumstance in which your husband would be justified being livid about losing benefits due to your salary would be if he relied on them due to financial abuse on your part. I know a few women in this situation - not entitled to childcare help because of their husband's or partner's salary but they don't have access to family money and can't afford childcare to work. But the correct target for ire is the abusing partner not the system.

JaninaDuszejko · 22/03/2025 07:07

NamechangeRugby · 22/03/2025 06:59

I don't think leasing a car via salary sacrifice, nor indeed private health or dentistry, counts to reduce your tax or lower your income for child benefit/child care purposes.

Op - if this is real, just make good to your husband whatever he loses out on because of your salary. Plenty of men do that, why shouldn't a woman if the roles are reversed?

Show quote history

You don't pay income tax or NI on salary sacrifice when leasing a car so it reduces your taxable income just like putting into your pension does. And child benefit and free childcare hours are based on your taxable income.

Salary sacrifice for private dental and health insurance only reduces your NI but not your taxable income.

Lostmyusernametoday · 22/03/2025 07:10

I think you’re being unreasonable but you will get the 15 free hours:

Who can get 15 and 30 hours for 3 to 4 year olds? All 3 and 4-year-olds who live in England are entitled to 15 hours childcare a week, over 38 weeks a year the year, irrespective of income levels, benefit status, or family circumstances.

Didimum · 22/03/2025 07:12

I think posters are being unfair here and jumping to the all-too-common disdain for the high earners.

I don’t think this post (if real as OP hasn’t popped up again), is actually about wanting to hide money because of entitlement to childcare. To me it’s clearly about financial anxiety, job insecurity and possible financial discontent in OP’s marriage.

OP mentions the instability of her job and you can hear the anxiety there. That doesn’t make for financial wellbeing no matter how much you earn. It’s also clear that OP’s basic salary is not actually be that high, due to her explaining that the majority of her earnings this year is sales and commission – that’s an unstable and volatile income and can be challenging for a family to financially plan around, depending on what her husband brings home and how stable his job and income are.

Her DH looks to be experiencing a lot of financial anxiety also, and that doesn’t have to be due to greed. It can simply be a symptom of the instability and volatility mentioned above. Especially if his income is uncertain also.

None of this means that they should be entitled to assistance from the state that they don’t qualify for, but it also doesn’t mean that they are secure, and inevitably that will heighten the emotional response.

Financial wellbeing isn’t just a figure, and too many people on MN don’t realise that.

Penguinmouse · 22/03/2025 07:12

This is ridiculous. You earn £260k and your husband is annoyed you can’t claim 15 free hours. The childcare trap is the cliff edge around £100k but after £140k~ it evens out. You’re probably bringing home what, 10k a month? Free hours are worth about £200 a month at my daughter’s nursery.

Bananafofana · 22/03/2025 07:12

You’ve fundamentally misunderstood the 100k tax trap / cliff edge. As many others have pointed out, you’re not just a little bit over.

what you are in is the “earn far too much to get anything at all”.

That’s what it’s like to live in the UK. DH and I pay effective 50% tax, pay for private school fees, private dental, private medical (including private mental health support and occupational therapy and speech therapy for dc) and get nothing from the state. If you don’t like it, go move to the US or Nz where tax is lower and the social security net is sparse.

springintoaction321 · 22/03/2025 07:12

frillygillymilly · 22/03/2025 06:10

I don't earn anywhere near the OP but think the 15 hours should be universal.

Why??

If someone has an income per month of £10k plus why on this God's Earth should they have anything paid for

springintoaction321 · 22/03/2025 07:13

And that is £10k AFTER tax FFS

ItsFineReally · 22/03/2025 07:14

Typo? Did you mean £160k?

Like PPs, I'm struggling to understand the reference to the £100k if you're at £260k. However, if you are at £260k, it's worth looking into more closely as that's the level you start to lose the tax relief on pension contributions.

springintoaction321 · 22/03/2025 07:15

TBF - I don't believe for a second this is a real poster. Because someone earning that kind of salary surely could not be so stupid to post on here with a daft question Confused

Didimum · 22/03/2025 07:16

NamechangeRugby · 22/03/2025 06:59

I don't think leasing a car via salary sacrifice, nor indeed private health or dentistry, counts to reduce your tax or lower your income for child benefit/child care purposes.

Op - if this is real, just make good to your husband whatever he loses out on because of your salary. Plenty of men do that, why shouldn't a woman if the roles are reversed?

Show quote history

I don't think leasing a car via salary sacrifice, nor indeed private health or dentistry, counts to reduce your tax or lower your income for child benefit/child care purposes.

Yes, it does actually. If it’s offered through your work as a salary sacrifice, then it is calculated into your net adjusted income, which is the figure that qualifies you for tax free childcare and the funded hours. As opposed to your gross salary.

Agix · 22/03/2025 07:16

Child benefit is like £20 a bloody week, why do you care so much