should higher income working parents get child care tax relief

[zippitippitoes]

..or would that mean the benefit would be spread so thinly that low income families would suffer?

If granny or sis wants to look after the kids then should they be able to be paid through government subsidy? Without formally becoming registered childminders.

\link{http://www.timesonline.co.uk/article/0,,17129-2233371,00.html\ david cameron on tax breaks for higher earners on childcare}

I think this thread illustrates the confusion of the syustem..I think everyone is allowed a free nursery place of at the moment 15 hours per week pre school year, but on the other hand some employers have signed up for a nursery voucher shceme which is effectively tax relief on child care but it depends on the employer electing to participate and it seems not many do.

Yes to tax-deductible childcare for all.

I thought childcare vouchers were only available from age 3. Am I wrong about this?
Company childcare schemes are not much good if you're self-employed, as I am.

Which isn't much good if you go back to work anytime between birth and 3.

Everyone's circumstances are different though. Some people might be high earners in careers which are very insecure and they might have more of a reason to try to build up their savings/pensions. Others might be high earners, but have a lot of student debt to pay back. I find it frustrating that my friends in Sweden can put 3 children in nursery for the price of one in this country. Looking at the birth rate, you cannot just target low-income families. I also thought it was really important to help out the middle earners as at the moment it's the very rich and the very poor who have the most children.

NO that is rubbish

Childcare Vouchers can be used to pay for the care of children up to the age of 15 (until 1st September following their 15th birthday) or the age of 16 if they are disabled (until 1st September following their 16th birthday).

It is the state funded nursery thing that starts at 3. So from the age of 3 you get an additional £90 a month (roughly, if they go 5 sessions a week)

Not sure which bit you're referring to as rubbish CD.

I can honestly say that the cost of childcare is a serious bar to our having another child. I am the only earner in the household. On a good income, but self-employed, so not brilliant job-security. Currently spending about 1300 a month on childcare and we'd just be very nervous about having to pay even more. Still, it's good to know that I'll be £90 a week better off in a year's time.

I agree with UWila, that childcare should be recognised as a public necessity. However, I would not want tax deductibility to replace child tax credits, because if it did, it would be a perk for the rich while poor women got shafted. Tax deductibility is shit for me, I don't earn enough for it to make any difference to my childcare costs. Whereas the government paying 80% of my childcare costs, is the difference between being able to work in the cash economy or claiming benefits.

Can we define "higher income"? I think people who bring in £200,000 per year can affford childcare. The trouble is that is not very many people. As I understand it, you have to be poverty sticken to get any real help with the cost of childcare. Isn't the threshhold something like £30k?

Beetle, childcare vouchers are available for any form of registered childcare for children age 0 up to 15 or 16 but your company must partake of the scheme. Both parents can claim it. DH and I both claim for our 2yo twins and we will save nearly £2k this year. This saving will increase when the boys turn 3 and the govt pays for 5 sessions for each child.

Despite the criticisms, I think the govt are actually doing quite a lot and I know that we are reaping the benefits. We are not eligible for any tax credits so child care vouchers have made a real difference to our finances in the last year.

Yes but it's all relative

People who earn £15k a year probably think you can afford childcare Uwila! Also presumably your dh/dp has a job too so that halves the burden

Isn't it about how much you have left over after bills, mortgage etc, not how much you earn?

Anyway, what I was saying is that these high earners shouldn't get the tax breaks!

If your household income is £58k or less you get tax credits, don't you?

Beetle I was saying that the thing about childcare vouchers not being available for under 3s is rubbish

Beetle I was saying that the thing about childcare vouchers not being available for under 3s is rubbish

To everyone who has posted saying that their employers don't offer childcare vouchers (salary sacrifice scheme), have you written to your M.P. ? The employers are not obliged to offer such a scheme as the government has not made it compulsory. Complain to the government via your M.P.

A friend of mine got a response saying that it was not government policy at present to make such things compulsory for employers as it constituted additional red -tape and the government had pledged to reduce such administrative burdens on employers.

Unless more M.P.'s are made aware of this major gripe of the lottery of availability of childcare vouchers tax savings, nothing will be done.

But I'm self-employed so I can't benefit from corporate childcare vouchers. And DP doesn't work. Until DD turns 3 I get sweet FA.

"But, they will recover it because they are only giving this break to people who go to work"

I am a bit confused by this. I am a tax payer. If I could set my childcare costs against tax I would get a huge rebate. The only way that the government would gain by this would be if either the tax rebate would make the difference between me working and not working at all, (so they would benefit from the tax left over after the rebate) or if the rebate would keep me in the workforce, and for instance mean that it was more likely that I would work once my children would be in school (when I would no longer be entitled to a rebate). Is this what you mean?
Either way, unless the tax break creates more tax payers, rather than just reducing the tax paid by existing tax payers, the government looses tax revenue.

True fio but they're less shafted under the current system than a tax relief system.

Right, just worked out that if you make 30k, you will net 22k. Childcare will cost you some £21k, then you have to pay for transportation to/from work and some work clothes with the remaining £1000. So, you are in the red, and you haven't even touched on housing and feeding this family.

Wouldn't the tax credit system give you some money towards that 21K, Uwila?

Those on higher wages are paying higher taxes however the cost of childcare is so high that for some people it is not economically viable for them to work and pay childcare so the economy loses out.

The relief should be available to higher earners also - rather than spreading the benefit thinner it would ensure that there are more people able to work at these levels and generate more income for the government.