Nursery childcare vouchers and tax credit query

[Ruthyn]

How are these two linked? We recieve family tax credit, and have been lobbying both our employers to offer the voucher scheme, whicc DH's work finally seem inclined to do. (They are a small company). But they are warning DH that our tax credit will be reduced.

So now we are unsure what to do. I was told a while ago that you can save a lot more using vouchers, especially if both parents can get them, and would be more valuable than a potnetial reduction in tax crdit. I know it is a bit complex, and I haven't included any numbers here, but can anyone help?

I don't mind including a few general figures if that would be helpful?

I'm not very up on this either but looking into it, I seem to recall reading on here if you only get the minimum CTC i.e. £545 then it's not affected but if you get more or claim the childcare element it is. I'm sure someone more knowledgeable will be along in a minute.

We get the minimum CTC and it wasn't affected by the vouchers, which are definately worth having in our case. But it's quite hard to find out - the voucher people referred us to tax office, tax office told us to speak to payroll and so it went on.

I get the minimum child tax credit and get the maximum of childcare vouchers and as far as I know it did not affect my tax credit (all £30 a month of it!).

Come to think of it I am not 100% sure I told the tax credit people that I get vouchers so had better check.

As far as I know it is generally better to get childcare vouchers than tax credits but I think it depends on your income. If for example you are a high rate taxpayers (lucky you!) then it is definitely better to get child care vouchers as you are saving 40% tax and prob don't get that much child tax credit.

I am not on a very high salary so pay 22% tax plus NI and I don;t get much from child tax credit.

In fact quick question: I know that the child tax credits are payable to people with joint incomes of up to £57k or so, so how come I get so little when I earn a fraction of that? Anyone know how they work it out?

I would try asking on www.moneysavingexpert.com someone there will know

You don't get the vouchers and the tax credits for them it's one or the other. There is a site that can tell you which you are better off with but can't remember which one. It basically works out that if you are getting more than the basic 10.50 from tax credits with your childcare included then you will be no better off or worse getting the vouchers.
The vouches are really suited to people in the higher tax band who can make a big saving.
The other time the vouchers are worth it is if you pay more than the tax credit limits so more than 175 per week for one child or 300 for two.