Childcare vouchers

[user1465146157]

Hello
Can someone please explain how childcare vouchers work?
Thanks!

You sign up to the scheme your employer uses
The money comes out of your wages and you are not taxed on it
You then use your voucher account to pay the childcare provider
There is a limit of £243 a month per person

Yep, as insancerre describes. The saving is in that you don't pay tax on that bit of your wages that goes towards childcare.

The money goes directly from your employer into your account with your voucher provider. From there you can either have a direct debit set up to a regular childcare provider (e.g. nursery) on a certain date each month, or you can use the balance ad-hoc. Basically you don't have to spend the full amount you put in each month in THAT month, you can save it up.

You need to tell you nursery or childminder that you want to pay some/all of the fees with childcare vouchers and if they're not registered with your voucher provider they sign themselves up. You don't need to so that, they sort that out themselves so long as you tell them who you're with.

As PPs have said. If you're a higher rate tax payer then you'll be able to claim up to £243 but only £124 of that is tax free (this is so the tax saving is the same for all, I think). It may make payment and budgeting easier though to claim the lot