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!

I agree - it is not something people are generally motivated to campaign about (or even interested in understanding) because it doesn't affect them, except perhaps in terms of worse public services and longer NHS waiting lists due to the numbers of highly paid professionals going part-time or refusing extra hours to stay under the threshold.

100% agree

funnel money into your pension and if you can get a salary sacrifice car scheme.

So you’d prefer this help would be restricted to those on what? Less than £30k a year

You’re not eligible OP. Annoying but it is what it is. We weren’t eligible either but had some grandparent help for childcare and I’m part time

I’d prefer it was universal, as I think it’s a social good that should be accessibly for everyone.

You know some people carry incredible levels of responsibility in their careers and will never reach six figures? It’s a salary out of reach to most people - particularly the people we rely on for a cohesive society, but well done punching down, that’s always a good look.

OP what’s your solution? It can’t be universal as it would cost too much (there isn’t a massive pot of money and some would argue that this money would better spent in a school or in the nhs).

The scheme is suppose to help women to stay in work or get back into work with the cost of childcare. As otherwise it would be too great for them and not at all feasible for these families.

What scheme would you like to see? More a staggered approach like child benefit? I believe even if this happened you still wouldnt be in the right bracket to receive any benefits?

Education and Health Care is also a social good. Universally available.....but a 160,000 salary gives you options outside of those services that the average worker does not have and could never dream of.

Equality and fairness are two different things.

She’ll do that and there will be even more children living in poverty.

she and high earners like her contribute 50% of all income tax receipts. Just 5% of workers contribute HALF.
she is subsidising the 95% - not just the low earners but 95% of all earners

low earners and mid earners do not subsidise her whatsoever even if she had free childcare hours

I’d actually challenge the idea it would be unaffordable - as I suspect so many people are reducing their income to claim it.

But at a basic level, if you must remove it, it should at least be done over a broader range of income rather than at a cliff edge - and implementing it at the same level as the £100k loss of the personal allowance is what makes it so punitive at this level.

Yes, in a capitalist economy, it tends to gravitate to a two tier system no matter what you do.

I'm not saying it's all bad - but what tends to happen is that the high earners using private services start grousing about the very existence of public services, because they see it as their tax money funding things they'll never use (even though they could). Then they pressure their friends in government to defund such services and lower the tax burden. If the government does cut funding, the schools and hospitals get even worse, and more people go private... and so the cycle continues and more money flows into the pockets of the academy chain CEOs and the healthcare trust heads.

I disagree. I don’t believe it is a ‘tax break’. After 100k you lose the personal allowance and access to free hours. You are talking about a system where you could find your net income less.

So the vast majority reduce their gross pay through salary sacrifice pension/car schemes. Or reducing working hours. This means there will be less money going into government coffers - I’d love you to explain how that that makes sense for anyone?

You do realise that even if higher earners did get free childcare it isn’t subsidised. They more than pay for it through their taxes. It is medium and lower earners who receive all the subsidies.

You are just moaning because you want them to subsidise you more. You literally want them to work and hand you the money albeit via government funding schemes.

You do realise that even if higher earners did get free childcare it isn’t subsidised. They more than pay for it through their taxes. It is medium and lower earners who receive all the subsidies.

You are just moaning because you want them to subsidise you more. You literally want them to work and hand you the money albeit via government funding schemes.

@ChildcareCost You keep saying that you don't mind paying extra tax as long as you have full access to public "benefits". But, of course, our taxes go towards much, much more than that!! I'm sure your family have benefited from the NHS. Or have needed the police. Or have used/will use our ("free") education system for many years. You and your family will almost certainly have benefited from most of the benefits out tax system supports. So in the grand scheme of things, you're not "losing" much at all?

OP, thinking like you do is only going to make you bitter.
You earn too much to get free child care - end of.
We all have to cut our cloth accordingly.
The £100,000 limit has been in force since 2017, so surely you knew this before you planned your family?

Ha ha “Wind the bobbin up” 🎵. I’d forgotten All about that. Strong memories now you’ve mentioned it.

Actually I’m self employed so got no pay (and therefore paid no tax) when I was off with the kids. Had some passive income. Also only 15hrs free childcare at the time which seemed to be only in some nurseries. So didn’t get that either. Started back in work again. Luckily all flexible due to being SE.

Many things are possible but so many are happy to blame others or bleet about annoying ‘rich’ people. without thinking about the bigger picture.

Well assuming ~£160k of income and ~£37k needed to cover the lost childcare help - that’s around 25% of my annual income just to cover the removal of one benefit.

Which seems quite a sizeable penalty.

Exactly

Given my nursery wasn’t able to tell me exactly how the new childcare scheme was going to be applied or their fees for next year until this week, no it was not a major consideration in my family planning.

In September 2024 I was not eligible for £2k of tax free childcare for a 9 month old baby. This meant about £5k of income over £100k was ‘lost’ as a result of the childcare policy.

In September 2025 I am not eligible for £2k of tax free childcare for a 9 month old baby plus about £12,6000 in free hours. This means £37k of income over £100k is ‘lost’ as a result of the childcare policy.

The former doesn’t impact my thinking much, annoying but absorbable. The latter is very significant and creates greater incentive to find a workaround that allows me to claim it (and possibly work less, for little financial impact).

Yes, it is subsidised - they wouod effectivebe getting a tax break whilst those earning much less who truly need free childcare to work, the money in yhd pot to cover theif much needed child care funding is less, because of yhd tax break gif tug d bigger earners whi feel they should get it because they earn six figures and children.

I guess the bigger earners neex to cut their cloth according to their mean . They’l still eat, they’ll still be able to heat.

it won’t plunge them into needing food banks, abx emergency gas/electric vouchers. It won’t plunge them into homelessness.

where do you live though? And how many kids do you have? How much childcare? I honestly don’t think it’s loaded. For many outside of London it’s comfortable: but definitely not loaded

But in the context of your whole working life, the period when you need preschool childcare is really quite short. Yes, you take a financial hit, but with a salary like that, you should be able to build up some savings ahead of time and also make up for it afterwards. You have a buffer.

Presumably whoever designed the policy thought you'd need a fairly high salary to build up this cushion, hence the £100k cutoff. (I have no idea how accurate this notion is, since I'll never earn £100k)

The preschool years are difficult for everyone. It's the people who would be completely sunk by them that the policy is meant to help.

Unfortunately the people in this thread are making it clear that is in fact the case