Help available is worth up to £2,000 per child annually
HMRC is encouraging parents earning under £100,000 annually to register for a money-saving initiative. During the 2025/26 financial year, qualifying parents could enrol in Tax-Free Childcare.
Eligible families who fail to apply risk missing out on yearly savings of up to £2,000 per child, or £4,000 for disabled children. Tax-Free Childcare assists with covering costs for approved childcare for youngsters aged 11 and under, or up to 16 for those with disabilities. Parents can claim up to £500 (or £1,000 for disabled children) every three months.
This means for every £8 deposited into their online account, they automatically receive an extra £2 top-up from the UK Government.
Posting on X, HMRC stated: “Don’t forget Tax-Free Childcare can help you save money on childcare costs this Autumn. If you’re a working parent with a child under 11, and you earn under £100,000 a year.”
Who qualifies for Tax-Free Childcare?
Families might be entitled to Tax-Free Childcare if they:
- Earn, or expect to earn, at least the National Minimum Wage or Living Wage for 16 hours a week, on average
- Have a child or children aged 11 or under. They stop being eligible on September 1 after their 11th birthday. If their child has a disability, they may get up to £4,000 a year until September 1 after their 16th birthday
- Each earn no more than £100,000 per annum
- Do not receive Tax Credits, Universal Credit or childcare vouchers
How to apply for Tax-Free Childcare
Submit an application for Tax-Free Childcare online. If you’re married, in a civil partnership and living together, or cohabiting as if you are, your partner must be included in the application.
You’ll need to provide your National Insurance number, Unique Taxpayer Reference (UTR) if you’re self-employed, the UK birth certificate reference number for any children you’re applying for, and the date you started or are due to start work.
There are specific rules for those registered as directors with HMRC. You’ll need to demonstrate that you meet the minimum income requirements to qualify for the scheme, potentially through PAYE records.
If you don’t regularly submit PAYE information, you may need to provide additional proof that you’re working and expect to meet the minimum income requirements over the next three months.
This might require a statement from your accountant, copies of invoices, wage slips, and bank statements. You may also need to provide year-end payroll, a letter from your tax agent or adviser confirming your salary has been paid and taxed, and annual wage slips.
