Loss of 30 free hours will cost me £37,000 of pre-tax income

[ChildcareCost]

9 month olds are eligible for 30 free hours from September. If you earn over the threshold, you do not get this 30 free hours plus the £2,000 of tax-free childcare.

My nursery typically charges £2,150 a month for an under-3. This works out at c. £10 an hour assuming a 50 hour week (open 8-6).

They have circulated the free hours schedule this week, and the monthly cost with 30 free hours is £1,100 hours for an under-3 (noting funded hours only cover 38 weeks).

This means the loss of the 30 free hours will cost me £12,600 a year. Plus of course the loss of tax-free childcare at £2,000.

So, I need to earn an extra £14,600 net just to cover the cost of not being eligible for this scheme.

To earn that £14,600 over £100,000 – I need to earn a gross figure of £137,000.

Surely this is not fair on the parents excluded from the scheme? It doesn't seem proportional that I need to earn an extra £37,000 just to recoup the loss as a result of not being eligible!

It’s in a mess because of the entitled take take attitude of so many people. Like this one

🤦‍♀️

Is this a joke?

You earn over £160k, that’s over £8k a month.

Pay your £2k childcare bill and you’ll have to suffer with only the £6k left over. The CF’y here is astounding!

@Squirrel1818

we never got subsided childcare and/or didn’t need it! Just the normal 15 hours when they turned 3

both partner and I had a day off in the week and luckily had grandparents so paid childcare was low. It’s also why we only had one child, we cut cloth to our means!

But to moan woe is me on 160k takes the proverbial! Childcare is expensive and kids have 5 or 6 weeks off in the summer they are both known before we have kids!

The 60% tax rate is between £100-125k because of the removal of the personal allowance.

I am describing the various marginal tax rates to
you, not my overall tax burden.

That is how ~£14,600 requires so much more to pay it - the 60%+ rate between £100-125k.

In a nutshell

Having kids is a money-losing game for all. If you don't want to shell out money towards nutseries/schools/activities/stuffed animals and non-stop snacks etc, don't have kids. No one gets their full salaries after having kids just for their own personal spends.

I get what your issue is OP. At the other end of the scale it's exactly the same issue for people on carer's allowance. You're allowed to earn £196 net to be eligible to claim it - but earn a penny over and there have been awful stories of carer's unwittingly going over the limit by a few pounds and having to pay the whole lot back. I feel more sorry for these people tbh.

www.bbc.co.uk/news/uk-68774399

But on both benefits there should be a sliding scale. Or they should both be universal and eligibility demonstrated by whether or not you care for a person for more than 30 hours a week and whether you have a child of nursery age. The amounts lost by HMRC would be far less than having to calcuate a sliding scale and prosecute people

But you can. No one is saying you can't. Education is free from four/five to 18. You can also use the roads and the NHS etc. But it's a benefit, not an automatic entitlement. It works similarly at the other end of the scale too with people unable to claim levels of UC if they have even minimal savings. Honestly, I'm more concerned about that as it prevents the poorest in society from any sort of progression.

Should it be possible in the tax system to lose £14,600 of net pay for earning a pound more?

As that is the current set up.

Out of curiosity, where would you put the cut off at?

You earn £160k. You shouldn’t need to rely on the free childcare.

Spot on.

It's not going to help anyone, and the government aren't going to lose 40k in tax revenue, because you're not going to work part-time and put £60k in your pension, are you?

You are earning between 4-4.5 times the average salary earned by a woman based on ONS AWE figures.

how often do you go without a meal/clothes in order to make sure your children eat/are clothed?

how often do you collect vouchers for money off at the supermarket, because you need to stretch the budget more and more?

how often do you take the bus because running a car is cost prohibitive?

how often do you think about going on holiday but can’t because if you do you can’t pay your bills?

how often do you visit a food bank because you can’t afford groceries/personal hygiene items/nappies/formula?

how often have you repeated (or thought) the awful right wing rhetoric about “if you can’t afford kids you shouldn’t have them”?

how often do you think about your privilege because you should. You are incredibly well off (and incredibly tone deaf to the situation many working parents are in) and should be satisfied with that, not whinging about how hard done by you are. Touch grass - you need the reality check.

Those earning more than £100k are still workers and in my experience they have worked blooming hard to get to that position and for most it is an all consuming type of job. Without these people working hard and earning lots we wouldn't have a welfare system. There wouldn't be any benefits for people to claim. Honestly if the country keeps pushing these people they will leave and then there will be no money left.

https://www.theguardian.com/society/2025/may/03/mother-of-autistic-boy-left-with-10000-debt-after-breaching-dwp-rules-by-192-a-week

I think probably 75% of my friends who have this issue are already working less hours and using salary sacrifice to claim the free hours, so quite possibly yes.

As I say, not my preference but for a day off a week, a huge pension contribution and the childcare help it’s financially the most rational option.

Out of curiosity, why is free education from 4 until 18 more valuable than childcare?

I pay all my taxes and I don’t expect “help”, but I also find it baffling that the UK’s costs for childcare are some of the highest in the world when we make a point to subsiding things like healthcare and so on. And if they disincentivise people especially women from being high earners, I can’t see how that benefits anyone.

People love to turn this into a jealousy game, which is probably what the government loves as it distracts from their huge failings in this respect. Other countries manage very cheap childcare, workplace crèches, proper paternity leave etc. the UK system is ridiculous and turning it into a game of jealousy and tricks to avoid high pay is annoying af.

I’ll swap with you OP

You can take our joint household income which is less than a third of your one person salary. And you can get the 30 hours towards childcare (you’ll still need to pay a couple of hundred per month mind.)

And I’ll take your £160k per year salary and pay for all my childcare.

Yes, because the cutoff needs to exist somewhere. And I paid for childcare, fully, until my child was 3 at £1200 a month earning well below you, and we didn't starve.

Problem is that everyone wants these fully-funded universal services and then bitch non-stop about "higher" tax brackets (they're not even that high)

There are some issues with how the 30 ‘free hours’ works - some people get 30 hours while working, say, 16, which is very annoying. Some people don’t get it because one parent earns over 100k whereas two parents each earning 99k do get it. Anyone with beef with the system please write to their Mp and explain the flaws in the system. I have done so a few times but they just ignore me, but the more of us that do it the more likely it is to change. My youngest leaves nursery in a couple of weeks so it’s not ‘my problem’ anymore, but we should get it changed to improve it for the future and to support more mothers in careers.

OP look I’m a high earner and a lone parent. And I know this will come as a shock to some people but…

Sometimes treating everyone the same is the most unfair thing you can do.

Taxation needs to be focussed on driving a baseline of peoples quality of life and earning potential up. Women have been caught in poverty cycles because they are still doing 90% of the childcare. The government is focussing on that and frankly I am shocked they actually did a bit of old fashioned class analysis and delivered something to the women on lower wages who want to work and need childcare.

Lots of jobs aren't compatible with childcare. Shift work for example. These jobs also expect you to turn up without kiddies in-tow. It's patronising to imply only high paying jobs go beyond typical school hours.

I think you are confusing state provision of services that you have access to regardless of earning - state school, NHS, police, fire, ambulance etc down to local authority entitlements like bin collection - with the provision of state funded benefits such as those that fund nursery care in private facilities for those unable to find state provision and otherwise would be paying all their wage if not more to fund private care. Hence it makes financial sense for women to leave the workforce until their children are school age because private fees are higher than their income. Funding of 30 hours care is supposed to enable these women to re-enter the workforce earlier and UC enforces this.

Impact on higher earners of policies is an unforeseen consequence as they are not commonly perceived as benefit claimants. But now they want to claim benefits - not because they need them to meet costs but because they would be better off if they teceived them.

Obviously the cut off for these benefits is too high and not related to benefit cut offs in general. It is obscene that cuts to disability benefits were even considered before redressing the anomalies that meant the already comfortable were excluded from applying for benefits or using tax loopholes to continue claiming.

What do you think state benefits are for?

It’s really not surprising this mindset had developed when state benefits prop up low wages and high rents - why shouldn’t high earners benefit from state subsidy?

Amazing how the already rich benefit from income from the state and the higher rate income tax payers feel hard done by but don’t support wealth rather than income tax.

The only point of agreement is that the poor and needy are undeserving.