Can someone explain childcare vouchers to me as if I am an idiot from Mars, please?

[artifarti]

That's it really. I know my work uses Busy Bees and that's okay with my CM who has given me all her details but I have no idea how it works!

Is it true that sometimes it's not worth doing as it can impact on your pension?

And my CM would like paying weekly but I get paid monthly - does this matter?

Finally - my DP is self-employed. Am I right in thinking that he is ineligible?

TIA!

Hi
I'm not sure about all the questions tbh, but we use a different provider and my dh gets paid monthly but we pay the after school club weekly. We do it all online straight into their bank account and then print off a receipt.
I don't think your dp would be eligible as it is something provided by an employer.
Not sure wrt pension, I'll have to look it up,

MLx

The weekly/monthly thing usually works out fine if the CM accepts the vouchers

You are right, your DP is ineligible

The impact on your pension is usually thus:

At the moment you get
salary = £x
Tax, pension and NI are calculated on that quantity, x

With vouchers you will get
salary =£x-(cost of vouchers)
Tax, pension and NI are calculated on x-(cost of vouchers)

so you might pay, in effect, less tax, less NI and a lower pension contribution.

Whether this is exactly how it'l work for you and how this affects the pension you'll get when you retire depends on the details of your pension scheme and they vary wildly. Best to ring the pensions people in HR and check.

i'm not sure it affects pension if you already do a salary sacrifice for it.
(this is the name for taking money for vouchers or pension contrib before tax/ni)

i have had to do EVERYTHING twice with busy bees and they have been late paying and generally annoying. i am not enjoying that they have got my money it is bloody hard to get it out of them.

Thanks everyone, that's useful. We don't have anything as useful as a HR department and so I will have to sort it out with the idiots in finance. I get the gist now though!