As part of the recent Budget, the UK government has announced a range of measures designed to help parents with the cost of childcare. One of these measures is an expansion of the government-funded childcare scheme, which will now be available to parents of children as young as nine months old to help pay for childcare and get parents back into the workplace.

 

Additional Hours

Under the new scheme, eligible parents in England can receive between 15 and 30 hours of government-funded childcare each week, depending on the age of their child. The scheme will be rolled out gradually, with children aged two having access to 15 hours of funded childcare from April 2024, followed by children aged from nine months from September 2024. Parents of children under school age will have access to the expanded 30 hours of funded childcare from September 2025.

 

Eligibility

To be eligible for the scheme, each parent will need to earn at least the equivalent of 16-hours per week at the national minimum wage over the upcoming three month period from when they apply, and they must each have taxable income of no more than £100,000.

In addition to the expanded childcare scheme, the maximum amount that parents who receive universal credit can claim for childcare costs has also been raised, providing further support to families who need it most.

These measures are a positive step towards helping parents manage the high costs of childcare and ensure that children have access to quality early education and care. While the scheme will be introduced gradually, it will ultimately provide much-needed relief for parents across the country.

 

Getting back into work

Due to the limited financial support for child care costs at present, getting back into work for some parents can feel challenging and as if they are simply working to pay for childcare. However, this welcome boost could make a real difference for people in these situations in the months and years to come.  

Just like the free child care available at present, the maximum hours available once the new measures are in place are term-time only but can be stretched across the course of the year, which equates to 570 hours per year available for 15 hours (approx 11 hours over 52 weeks) and 1,140 (approx 22 hours over 52 weeks) for those eligible for 30 hours. 

Meaning a surge in demand for part-time jobs, in particular, is expected to be high. If you’re a parent looking to get back into work, we’re here to help. To help explain what you’re entitled to at present and how that could change as the new childcare measures roll out, we’ve popped together a helpful guide below. 

 

How it works now

9-23 months

At present, there is no free childcare available for under 2s unless you are in receipt of benefits and working, in which case you are able to claim some of your childcare costs back. Or if both parents are in work and earn a combined income of under £100,000 they may be eligible for tax free childcare.

 

2-3 year olds

The same as above applies to most 2 and 3 year olds. You can however, get up to 15 hours free childcare per week if you live in England and get any of the following benefits:

• Income Support
• Income-based Jobseeker’s Allowance (JSA)
• Income-related Employment and Support Allowance (ESA)
• Universal Credit, and your household income is £15,400 a year or less after tax, not including benefit payments
• The guaranteed element of Pension Credit
• Child Tax Credit, Working Tax Credit (or both), and your household income is £16,190 a year or less before tax
• The Working Tax Credit 4-week run on (the payment you get when you stop qualifying for Working Tax Credit)

 

2-year-olds can also get free childcare if they:

• Are looked after by a local authority
• Have an education, health and care (EHC) plan
• Get Disability Living Allowance
• Have left care under an adoption order, special guardianship order or a child arrangements order

 

However, it is important to note that this only comes into place the academic term after a child turns 2. So, for instance, if your child turns 2 in May, you would not receive free childcare until September due to the Summer holidays that occur between the spring and Autumn terms. The 15 hours is also term time only (which equates to 38 weeks of the year), so if you were to stretch this over the year (which many providers allow you to do), you would get 570 hours to split across the year accordingly which averages out to around 11 hours per week. 

 

3- 4 year olds

At present, all 3 and 4 year olds in England are eligible for 15 hours of free childcare or 30 hours if eligible. To be eligible, (both) parents must work and earn the equivalent of £166 per week, each with a taxable income of no more than £100,000. But again, this is stretched over the academic year and does not kick in until the term after a child’s third birthday, so would work the same as above with 570 hours per year available to all and 1,140 (approx 22 hours over 52 weeks) for those eligible for 30 hours.

 

Tax Free Childcare  

You can also get up to £500 every 3 months (up to £2,000 a year) for each of your children to help with the costs of childcare. This goes up to £1,000 every 3 months if a child is disabled (up to £4,000 a year).

How Tax- Free childcare works is that for every £8 you pay for childcare from registered providers, the government will pay £2. This works by setting up an online account for your child through the government scheme and for every £8 you pay into this account, the government will pay in £2 to use to pay your provider.

Tax free childcare is available to children under 11 where both parents are working and earn a combined income of no more than £100,000 per year. 

You can get Tax-Free Childcare at the same time as 30 hours free childcare if you’re eligible for both. Check the Gov website for more information and eligibility criteria. 

 

How it will work from April 2024

9- 23 months

No changes 

 

2-3 year olds

15 funded childcare hours available –  in addition to previous conditions, this will now also be available to households where both parents work and earn the equivalent of at least £166 per week, each with a taxable income of no more than £100,000  (Again, the term time conditions apply) 

 

3-4 year olds 

No changes – 15 hours available to all or 30 hours if eligible.

 

How it will work from September 2024

 

9 -23 months

15 funded childcare hours available to households where both parents work and earn the equivalent of at least £166 per week, each with a taxable income of no more than £100,000  (Again, the term time conditions apply) 

 

2-3 year olds

No changes- 15 hours available if eligible.

 

3-4 year olds

No changes – 15 hours available to all or 30 hours if eligible.

 

How it will work from September 2025

 

9-23 months

30 funded childcare hours available to households where both parents work and earn the equivalent of at least £166 per week, each with a taxable income of no more than £100,000  (Again, the term time conditions apply)

 

2-3 year olds

30 funded childcare hours available to households where both parents work and earn the equivalent of at least £166 per week, each with a taxable income of no more than £100,000  (Again, the term time conditions apply)

 

3-4 year olds

No changes – 15 hours available to all or 30 hours if eligible.

If you’re looking for your next role or simply interested in getting back into work after a break, our expert recruiters are here to help. Feel free to contact us, and we will be able to advise you further on your next steps back into the workplace.