Tax free childcare
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You’ll need to add your nursery to the list within your account. The nursery will invoice you separately, so once you know how much you’ll need to transfer the money from your bank account into the tax free childcare account using the details they have provided and then the government top it up. Once it’s cleared you then need to set up a payment to your nursery within your childcare account
The nursery will let you know your bill. Times it by 0.8 on the calculator and that will tell you how much you need to deposit into the tax free childcare account, the government will automatically top up the other 20%. Find your nursery on the list and I usually bank transfer the money into tne tax free account (the bank details are on the account) then you have to manually pay them through there. If it’s the same amount each month you can do standing order. It’s tricky at first but easy once you’ve done it once or twice! Ive added a little video hope it helps! X
Please don’t feel like an idiot asking this, I’m about to set up mine and also have absolutely zero idea of what I’m doing - so this thread has been doubly helpful and informative for me - thanks 🙏 xx
Omg thank you ladies, especially @Amy that's exactly the level of detail and step by step I need to understand what to do, I'm neurodiverse and it feels like there is little to no guidance on how to do this
Just be aware that tax free childcare is capped at £2000 per year (£500 per quarter) so if 20% of your childcare bill amounts to more than that you’ll notice that the government top up into your account is lower every third month and you’ll need to top it up to cover your full invoice.
@Amy can you help me please! I was worried that if I calculated the 80% and deposited that then the government would only add 20% of what I’ve deposited? Or will they know I’ve only deposited 80% and top up 20% of the total bill? Or if I deposit 100% of the bill and they top up on top of that can I withdraw the remainder? It’s so confusing 😫
@Lizzie no don’t worry, you just put in 80% of your total monthly bill and the government will then top up the extra 20%! X
@Lizzie and yeah you could top up more than you owe so that next month you’d still have money left in there and would top up less but I find it easier to keep a track of if you just put in the 80%. Easiest way to figure out what you need to deposit is times your full amount by 0.8 and that’ll be exactly how much you owe and the government will deposit the other 20% x
@Amy thank you so much! The whole process is so confusing, I don’t know how anyone stays on top of it all 😂 One last question, how long does it take the government to process? My fees are due on Monday and I’ve been so befuddled I’m only just getting round to paying it 🥲 will it all be sorted in time?
@Lizzie if it’s your first deposit it can take a little longer sometimes 24/48 hours but after that it’s usually in within a few hours, maybe a little bit longer. However, I don’t know how long it then takes for the nursery to receive it once you release the funds to them x
@Amy thanks so much! Fingers crossed I’ve done it all right. I’ve set the payment to the 1st but can’t see my deposit in there yet but let’s wait and see 🙈🤞🏼 you’re a star, thank you! X
Ok so I thought I did this correctly, I put the money through to the UK gov account with my reference at 20%less than the invoiced amount but now I got an email from the nursery saying that they haven't received a thing and yet they have my payment code. Was there another step I was supposed to complete?? I just looked at my childcare account and it says there are zero transactions??
Did you transfer the money to the nursery? You need to set up and send the payment from the tax free account yourself.
Oh ok I think I realised what happened, incorrect digit so it didn't go through. So once the money hits the UK gov account I have to transfer the money from the childcare account to the nursery?
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Will the money show up as the full amount with top up or just the money I put in?
It will show the full amount including top up, in transactions you will see a separate one with the amount you put in and then the amount the gov have topped up but the overall amount will be everything.
Thank you so much that's helpful, I just need to wait and see when the money goes their account now since it didn't go through the first time
Can someone please explain, I thought it was 20% but I put 100 in and it topped up £25? Is that not 25%🤣🙃
@Hannah they put £2 in for every £8 you put in which is 25%
You put money into the account and then the government will top it up with their contribution. The nursery will invoice you and then you will log in and send a payment to the nursery from the government account.