Child Care Vouchers - Some Questions.

[thaigreencurry]

Very confused as we were not entitled to them for ds1 but think we ought to register before the deadline of 6th April for ds2.

Dh is HR tax payer, I don't earn enough to pay any tax. My understanding is that in order to be entitled to the maximum tax relief you have to register for the scheme before 6th April as the tax benefit will be reduced for HR tax payers after that date. At the moment I'm not paying for any childcare as I'm recently self-employed and not in profit yet. Ds2 is due to start at a nursery in September 2012, I'm hoping I can get away without paying for childcare until then as I'm currently working mainly at weekends and in the evenings.

If we register now will dh's employer start deducting the amount from his salary now or can we register but wait until September 2012 until we start paying for the vouchers?

Also dh is only just in the band for HR tax if we register for the vouchers could that push him into the lower bracket meaning that we retain our CB in 2013? How would that work?

TIA

Here are the exact words from the instructions given to employers on how to operate this huge piece of red tape:

"In order to fall within the former arrangements, an employee must have submitted an application to his or her employer on or before 5th April 2011 and be entitled to receive the tax/NICs exemptions on that date. The employee does not have to have received his or her first childcare voucher on or before 5th April 2011 but must be entitled to receive them as at that date."

So you can in theory wait until September 2012 before actually getting vouchers, but this is does depend on the procedures operated by your employer and the voucher provider so you will need to check. It might be worth getting a small amount of vouchers each month to make sure there is not some cock-up that makes you drop out of the scheme at April 2012.

How the proposed restriction of Child Benefit will work is anybody's guess at the moment :(

Oh thank you. dh has sent me the information from work and it looks like we have to contribute a minimum of £10 per month so I think we will get started just in case there is a hitch.

The biggest hitch is probably going to be ensuring the application form is in the system by the due date, although it is as much in his employer's interest to do this as it is his.

Also make sure you understand how often/how much notice is needed for changing the voucher amount.

Dh thinks he might be too late as his employer stipulates that you have to choose your flexible benefits at the end of December each year. What a PITA, I think he will have to push it with them. If it wasn't for the change in government policy he wouldn't be requesting childcare vouchers until next year.

He could mention that it is in the employer's interest to register him before the 6th April because if they don't:

1. they will have to operate the ludicrous 'basic earnings assessment' for him every year
2. they will only ever get the NI savings on the lower level of vouchers

Thanks for that.