Help with childcare costs
Childcare is expensive and is likely to be the biggest cost you face in returning to work. There are a number of different sources of help with childcare costs. This article outlines the various sources of help with childcare costs, but for more information we recommend that you visit the government’s Childcare Choices website.
Free early education (free hours childcare)
There are a number of free childcare schemes available, depending on where you live. These are officially referred to as ‘free early education’ schemes, but are also known as 15 or 30 free hours childcare.
In England, 15 hours of free education and childcare is available to some 2 year olds if you’re on a low income benefit or your child has additional needs, 15 or 30 hours of free childcare is available to eligible working parents of children aged between 2 and 4 years old, and from September this is being extended to children aged 9 months old. 15 hours of free universal childcare is also available for all 3 and 4 year olds. See this page for more information.
In Scotland, all 3 and 4 year olds are universally entitled to up to 1,140 hours of free childcare per year (roughly 30 hours per week during term time). If you’re on a low income benefit or you or your child are care experienced you may also qualify for 1,140 hours of free childcare per year for your 2 year old. See our article on free childcare in Scotland form more information.
In Wales, eligible working parents of 3 and 4 year olds are entitled to up to 30 hours of free childcare per week through the Childcare Offer for Wales. If you live in a Flying Start area your 2 year old may be eligible for 12.5 hours of free childcare per week. See here for information on free childcare schemes in Wales.
Support for working parents
Tax free childcare
Tax-free childcare is a government scheme that pays 25% of childcare costs up to a maximum of £2,000 per year. The scheme is open to parents of children under 12 (or under 17 if disabled). To be eligible for the Tax-free Childcare Scheme, you must be working (and if you have a partner they must work too), and you must not be receiving any support through Tax Credits or Universal Credit.
Important: If you claim Universal Credit or tax credits, you should not apply for Tax Free Childcare without being certain it is the best option for you as it might stop your benefits.
Universal credit
The childcare element of Universal Credit (UC) can help towards the costs of registered or approved childcare. If you qualify for UC and are eligible for the childcare element, you can claim up to 85% of your childcare costs up to a maximum of £1,014.63 for one child or £1,739.37 for more than one child (for 2024/25).
Important: You should not claim Universal Credit if you already get benefits it replaces (e.g. tax credits, housing benefit), as you may end up worse off and you cannot return to your old benefits.
Other options
Other options that might apply if you are already claiming support include:
- Employer-supported childcare is still available in some circumstances but you cannot join a voucher scheme unless you are already in the scheme.
- The childcare element of Working Tax Credit can help towards the costs of registered or approved childcare. However, in most cases, you can only get this if you are already on either Child Tax Credit or Working Tax Credit.
Which schemes can be used together?
The general rule is that you cannot use state support for the same costs. If you use more than one source of help with your childcare costs, make sure you check the rules so that you are not getting overlapping help. For more details, see our article on which childcare schemes can and can’t be used together.
The government have a childcare costs calculator which can help if you are trying to decide which scheme to use. However, it won’t calculate what you could get on Universal Credit: to do this, you should use a benefits calculator.
This advice applies in England, Wales and Scotland. If you live in another part of the UK, the law may differ. Please call our helpline for more details. If you are in Northern Ireland you can visit the Labour Relations Agency or call their helpline Workplace Information Service on 03300 555 300.
If you have further questions and would like to contact our advice team please use our advice contact form below or call us.
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