Impact for employers

Unfortunately, the Government closed the Childcare Vouchers scheme to new entrants on 4th October 2018. This means that if you’re a parent looking to join Childcare Vouchers for the first time, or an employer looking to start a scheme in your business for the first time, that option is no longer available to you.

Any parent already participating in the Childcare Vouchers scheme before 4th October 2018 can continue to benefit from the savings as long as their child remains eligible*, they stay with the same employer, and they have had a wage adjustment and received vouchers within any 12 month period.

Key Facts

  • Employers have no role in the administration of Tax-Free Childcare; employees apply directly with NS&I
  • Families cannot benefit from the tax and NIC savings via the existing Childcare Vouchers scheme and the savings from the new Tax-Free Childcare scheme at the same time
  • Some will be better off staying on the Childcare Vouchers scheme, whereas others will be better off with Tax-Free Childcare
  • If a parent leaves their employer’s Childcare Voucher scheme in order to use Tax-Free Childcare they will not be able to rejoin
  • Employers could face potential losses in NIC savings if employees leave to join Tax-Free Childcare (up to £402/per year)

To find out more and understand the actions you need to take as an employer, download the Employer’s Guide to Childcare Vouchers & Tax-Free Childcare here.

Employers guide to childcare vouchers tax free childcare

*Eligibility will end 1st September after the child's 15th birthday, or 1st September after their 16th birthday if they are disabled