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Coronavirus: Tax Credits - Help with Childcare Costs
Tax Credits - Help with Childcare Costs
If you claim help towards your approved childcare costs through Working Tax Credit (WTC) then your award will include a Childcare Element.

Although normally paid to the main carer alongside Child Tax Credit (CTC), it is actually part of WTC and therefore has various work conditions attached to it.

Childcare costs stopped?

If your childcare costs have stopped, you must report this to HMRC.

Childcare costs still being paid?

Initially the only children able to access childcare were those of critical/key workers, but since June 1st the government has encouraged certain educational establishments to be open to more - though critical workers' children continue to take priority. Guidance from gov.uk here.

Workers continuing to work their normal hours (or more) will continue to be entitled to help with their childcare costs through Working Tax Credits.

If their hours have dropped then they may also be paying less childcare; if this is the case then where the average childcare costs decrease by more than £10 a week then they must report this to HMTC.

But if their hours have dropped then may have dropped below the required level to receive Working Tax Credit.

At the moment where someone's hours have dropped due to the Coronavirus, and this is a temporary measure. then they will be treated as working their normal hours.

Childcare costs still being charged?

Any nurseries which have  temporarily closed during the pandemic may still be asking for a retainer to be paid to keep the place open for the child.

Recent guidance suggests that the DWP will not cover these costs for Universal Credit, so HMRC may also not cover them under Tax Credits.

Click here for more information about Tax Credits and childcare costs.
Frequently Asked Questions
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