Needing to reduce income to get free childcare

[Katie1186]

Hi all,

I earn over the £100k threshold and actually would be better off if I contributed £10k into my pension to qualify for the 30 hours of child care.

Has anyone done this where you have manually contributed after being paid or do I need my employer to do this in order to reduce my income??

I know people who have had their employers do it but I don't know anyone who has had to manually do this themselves.

Thank you so much in advance!!

Oh, that's great.

We need to legislate that those pesky high earners must not have kids. They should only work and pay their taxes to fund us all.

Having children is a choice. No one forces you to have children (unless you're in an abusive relationship) you chose to have children.

No one chooses to be disabled.

Of course you need to have childcare if you work and don't have a partner to cover, but seriously. It was still a choice to have children.

Can't afford childcare (on your 100k plus salary) don't have them.

Ok, let fuck all the disabled, because the "high earners" can't pay their childminders and nannies and nurseries.....

(Edit spelling)

Can’t make an argument, attack the poster instead.

I think you need to talk to pension provider and ask them how to do this.

It was odd with DH - they had to set up a different account to pay extra into linked to main pension account- we weren't at your income but DH wage was close to child benefit threshold 50K. The money covered bus fare to college - bus fare here are not like England cheaper ones - so wanted to keep if we could. Plan was to then not renew for youngest at 16 - but then threshold went up to 60K and we're now well within that so have so her college bus fare will be covered from CB.

Can't afford children on your NMW don't have them. OP can afford HER children. She can't afford them whilst paying for those who can't pay for own kids.

Can't afford childcare (on your 100k plus salary) don't have them.

But it’s just paid for if someone is on a lower salary and they aren’t told don’t have them if you can’t afford your childcare.
Great logic.
Got you.

It's what the all or nothing system encourages. My single child in full time nursery, without free childcare is £18K a year. Because they've jacked up prices because the free hours aren't funded properly.

So yeah, if I earned £110K of course I'd stick £10K in a pension rather than spend £18K on childcare (well more like £12K as fees still around £6K with free hours).

If the government had a banded system that meant for every £1 you earn over the threshold you lose 50p of funding then people would be more likely to declare that earning and pay the tax, childcare etc.

The two things aren't necessarily related.The disability benefits bill has risen to a point where lots of people feel that it is too high and unsustainable. The system encourages perverse behaviour and needs to be reformed.

OP should also have help with her childcare bill. Lord knows she pays enough into the system. Next they will be means testing state school places and people like you will be rubbing their hands with glee as more money for the disabled. No wonder so many with money and choices and moving away from this country.

I think you are missing the point. If you were a single mother and didn't have any food for the children and no more money until a week on Tuesday, would you (a) let them starve? or (b) take that £25 cash in hand cleaning job? I'm waiting to hear from all those who pick (a). It's not about whether people would do the same thing in the OP's position - it's about whether they would do the same thing if they were poor and benefits didn't put food on the table. I applaud everyone who will happily go hungry and let their children go hungry rather than break the law to uphold the right of a wealthy parent to claim benefits. Nobody is saying the OP shouldn't claim, they are saying that there is a disparity between the moral grounds of posters, that they uphold benefits for the rich whilst arguing to take away benefits from the poor.

I am not missing the point... your scenario has no bearing on OPs situation. So much whataboutism on Mumsnet.

I am not even sure why so many people felt the need to weigh in with their own view or give OP moral advice when at no point did she ask whether she should do this, she asked for assistance on how to do so.

Don't have kids if you can't afford the childcare only works when everyone is on the same playing field. Sure someone earning £110K can't afford the £18K a year childcare fees for one child. For 2 kids that's £36K. But someone on UC can afford it because their childcare is free because they have the 30 hours, paid for by the people earning that £110K and paying 40% tax on it.

It's not right that someone on UC can have 2 kids in childcare completely free when OP would have to pay circa £36K a year in fees for the same setting. And the government isn't even paying the nursery the £36K as funding, so actually the OP would also be part covering the free child's nursery place too.

I agree, don’t have children if you can’t afford them. That applies to everyone regardless of income and source of income.

I've been on a lot of these £100K childcare threads, but this is one of the most bizarre!

We now have PP suggesting its perfectly OK to not declare income and thus pay no tax, provided its cash in hand or you're a lower earner (for interest, what income levels are we using to determine the point at which this isn't ok?!).

Equally have PP stating that the loophole (FYI, not a loophole - pension contributions are tax-free for everyone not solely higher earners up to a max of £60K per year) must be closed and that those that support these laws must be wealthy etc. I know several people on £100K+ who have been on the poverty line themselves at times in their life, so this is just untrue. Not everyone commanding £100K+ has grown up in wealthy homes, with private educations etc. Most are just normal folks! Generational wealth is a totally different thing to someone on £100K and paying tax via PAYE.

When we're debating someone actively committing the crime of tax evasion as being the morally righteous Vs someone making a simple pension contribution then I think we've taken a wrong turn into Loony Land. 😂

Agreed, someone on £100k with a basic pension contribution through auto-enrolment (which is now a requirement for every employee in the UK) will be taxed at 30% overall. The jobs that pay this much and upwards are typically high-pressure, high-stress and require significant overtime as well. The OP is far from a scrounger, she is a net contributor to the society and is already helping many (including those who you'd consider scroungers). Whoever called her that should be seriously ashamed of themselves and should apologise immediately.

The other key way of reducing salaries below 100k is to go part time. Is the op allowed to do that? Or is that begrudged as well?

Personally I’d prefer hospital consultants, GPs even accountants to work full time rather than cut their hours to avoid a badly thought through threshold but it is certainly another option.

OP may also have an option to do this via a self-service portal if there is a pension administrator involved, which is not unusual. You just need to ask your employers about all the possible avenues

I wouldn't even introduce guilt into this. Additional pension contributions are a legal method of reducing your income, encouraged by the government as it reduces government's burden by increasing self-reliance in older age. The pension is taxed again at the point of withdrawal, so I don't see how anyone should feel guilty for behaving in such a responsible manner

Yep payroll first - DH then said he had to contact provider directly but they talked him though their process.

Extra pension contibutions are a good thing long term anyway.

My FD isnt the most accomodating, so I have mentioned to my manager that I will need this, but just trying to see if I can manually do this for ease. But thank you for the links :)

Is there a 'confused' button? I really don't understand your argument. Childcare provision should be a universal right, regardless of your income level because access to quality childcare is a fundamental need that supports both children's development and parents' ability to work or pursue education. Making these benefits universal ensures that all families, regardless of income, can plan their lives with stability and confidence, reducing stigma and administrative burdens associated with means-testing. This thread would be completely unnecessary if we had a more universal system akin to much of Continental Europe and Scandinavian countries

This is one of the most batshit threads I’ve read on MN and that’s saying something as I’ve been around for a while.

What on earth does the OP’s tax arrangements have to do with the reduction in benefits for disabled people?

If OP doesn’t put £10k or whatever in her pension it will have no impact whatsoever on the financial situation for people on PIP or single mothers living in poverty. There are people on this thread behaving as if she is taking food out of people’s mouth because of her ‘immoral’ behaviour when she is simply asking how best to make to make a financially sound decision and get the free childcare she is entitled to. It is not her fault some of you are struggling.

OP - you do you. I was recently advised to put about £20k into my pension to reduce my tax burden and I am taking the advice. I paid almost £50k in tax last year for the benefit of living in this shitshow of a country.

This is very common advice on personal finance boards and resources. It’s not really a loophole, it’s the way the system has been designed and implemented. Given OP is more likely to be a net contributor than many of the people posting here, I can’t get worked up about it. I would do it too.

You shifted the conversation away from the issue at hand. You are making a broader moral and political argument that, while valid in its own context, doesn't actually refute or even address the core distinction that MidnightPatrol is highlighting.
MidnightPatrol’s argument isn’t about the morality of poverty or whether people in desperate situations deserve empathy—it’s about the difference in legality and intent between two actions: tax evasion through undeclared cash work versus legally contributing to a pension scheme.
MidnightPatrol is pointing out that one action is illegal and undermines public systems, while the other is lawful and encouraged by policy. Whether or not someone in poverty has a moral justification for bending the rules doesn’t change the nature of the comparison. Morals might explain why someone breaks a rule, but they don't change the fact that one is a breach of the law and the other is not.