How are nursery fees calculated?

[badfurday]

Can someone tell me how nursery fees are calculated?

My fees are 42.50 a day, I am working it out by doing 42.50 x 4 days =170 ( I'm working 4 days) then 170 x 52 \12= 736 a month. Is this correct or am I way off?!

Also, anyone have any experience of salary sacrifice schemes, worth doing?

Do they charge for bank holidays or inset days? I'm assuming you don't pay for 52 full weeks either?

I'm not sure? I thought you had to pay when you take holiday too?
I'm not going back to work until January but just trying to get the figures worked out.

It depends on the nursery. Where I work there is a nursery attached and parents don't pay for public holidays of when it is closed. Check their website for details or speak to the accounts manager for a written breakdown of costs.

That is how we work out our fees op
Daily rate x no of days a week x 52 weeks ÷ 12= monthly fee

At my nursery I only have to pay for one day during the school holidays (and dd only goes one day- as I work in a school) so those weeks work out cheaper, but then the overal yearly cost is divided by 12 to get the monthly payment.

Ours doesn't seem to be worked out into equal months, they would times the daily rate x no of nursery days in a week = monthly fee

Means fees change depending on if it's a 30 0r 31 day month etc.

Thanks all. I guess if I aim for an average of 750 a month it will allow for any difference in cost per month.
Scary amount of money for us to afford, this is an nhs nursery so subsidised. Not sure how we'd manage if not

We also have a term time contract which is worked out over 11 months
Daily rate x no of days in week x 38 ÷ 11

Oh, and about the salary sacrifice -have a look if you would be eligible/better off claiming working tax credits. Generally the rule is that if you can get working tax credits you are better off claiming that.

How old is your child? Long to go till you get any of the 'free' 15 hours funding? DD is now 3 and our childcare costs have been since she was just under 2 £1300pm with childminder, £950pm with under 3 room at nursery and are now £600pm in the preschool. So that's a massive reduction in costs just over a year.

Can't get tax credits. The salary sacrifice scheme seems a good idea but I hate the idea of nearly half my wages going before they even reach me, it's probably just a psychological thing!!

My daughter will be 9 months when she goes to nursery, so another 2 and a bit years of paying fees. I'm sure we will manage some how, we will just have no life for a while!

So with the salary sacrifice you pay it from your gross salary?

It is expensive to send younger children to nursery. Could you work less hours or take parental leave a bit longer?

Yes. The salary sacrifice takes the money first so you end up paying less tax on your remaining salary.

Pro rata I earn 1550 a month so I will end up with 1050 actually paid to me. The nursery fees will already be paid at 800 a month it does work out a lot better this way.

You can usually only get £243 a month on the salary sacrifice/vouchers scheme. However, if your partner's employer also runs the scheme, they can get the same too (although I think the figure is lower of either of you are higher rate tax payers).

Dh and I both get the maximum amount, and we reckon it saves us just over £100 pcm. It's actually good that it comes out of your salary before you get it, as it means you're never panicking about how you're going to lay nursery fees this month!

Luckily my place of work does a whole amount salary sacrifice. I didn't know about it when I queried the childcare vouchers,which again would help like you say.

I work for the nhs so not sure if it's an nhs staff thing? But definitely a perk of the job!

Your employer may let you buy as many childcare vouchers as you want, however you will only receive tax benefit on £243/mth (£124 if higher rate tax payer).

Bugger, thought it looked to good to be true.

If your family income is under a threshhold you may qualify for a discount. Where I work its £3k family income after tax pcm (London).

Some nurseries are flexible - if you ask! If they are needing to boost numbers, they may offer a discount if you are a key worker.

Badfurday - there are some schemes that let you do a whole amount of a salary sacrifice. It is limited though as it has to be a workplace nursery but this is what you may be entitled to. I used it as my firm offered the same thing, all of my nursery fees were annualised (mine equated to about £14,500 per year, or £1200 a month) and deducted at source, I therefore didn't pay tax and NI on all of the fees (it was a saving of about £400 a month for me). If that is the type of scheme you're entitled to, then its definitely worth doing. The only proviso to that is that you need to carefully check how it affects the rest of your benefits - so in my case, my salary was say £30k but I was left with £15,500 once the nursery payment was deducted (gross). Any redundancy / death in service / maternity pay was based on my salary of £15,500 (so I came out of the scheme when I was pregnant 2nd time around).

Also, does anyone know if funded kids and non-funded kids have different hourly rates? My nursery seem to have two rates for us. Is that how it is in general?