How do childcare vouchers work?

[Scooby12345]

Can someone please help explain how this works? I understand that £243 is the max per month.

Say i currently earn £1500 per month after deductions, what would it be if i got £243 in child care vouchers?

Also my husband can get them from his work too, so can we both get them from work then club them together to pay nursery?

Just done an online calculator that says we are better off using vouchers than claiming for chilcare element of child tax credits.

(i've obviously been off work too long my brain isn't working!!)

Thanks

 

[pandv]

Ok for ease say you were earning £2000 per month, £500 of this is deductions and you come out with £1500. You would sign a variation to your contract to allow your employer to make the deduction of £243 per month. This would show on your payslip as a deduction before tax. You would save both tax and NI on the £243 so around 30% - £73. Your new take home pay would be £1330 and you would receive £243 in childcare vouchers. Your huband can do the same and you can both use the vouchers to pay for your childcare costs.

 

[Kte]

What pandv said!

I was going to look at wage but prob is I have other deductions so I come out with less.

 

[pandv]

Also and this is something not a lot of people realise if you have a second child and are receiving childcare vouchers for your first you are entitled to receive the vouchers throughout your maternity leave. Companies are not allowed to make deductions from SMP so they have to pay you SMP plus provide the childcare vouchers as a non-cash benefit. A lot of companies will try to get you to "opt out" so they don't have to provide them but it has to be you that says you don't want them anymore otherwise its sex discrimination.

 

[JenStar1976]

You can also start claiming before your child starts nursery. OH and myself both get the vouchers from our employers and started them when Alex was 1 month old. By the time he goes to nursery at one year old, we will have a massive stash of them to use. Our childcare costs will be £800 a month, but because we have the vouchers saved up, we won't actually be paying out £800 a month until Alex is about 2.5 years old (because we will still be getting the £243 each in vouchers each month). Between us, we save £100 per month by using childcare vouchers. x