Operate, manage and review a childcare voucher scheme

Key points

  • Following the phasing in of the new Tax-Free Childcare scheme from April 2017, from 4 October 2018 no new entrants are able to join a childcare voucher scheme. However, employees already in an existing childcare voucher scheme before this date can continue to benefit from it, provided that they remain employees of the employer, and the employer continues to offer the scheme.
  • Childcare vouchers enable limited tax and national insurance savings to be made by the employer and employee provided that certain conditions are met.
  • Employers need to decide whether they will produce and administer vouchers in-house or use the services of a voucher company to do this.
  • Employers that provide childcare vouchers should carry out a regular review of this benefit to monitor take-up, savings and effectiveness. They also need to watch out for any specific changes to the tax regime governing childcare vouchers, and the potential impact of new government initiatives on existing arrangements.

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