Childcare Funding
Early Years Free Entitlement (EYFE)
What you are entitled to?
All three and four year olds are entitled to 15 hours of free early education for 38 weeks of the year. This applies until they reach compulsory school age (the term following their fifth birthday). The early education can take place in nurseries, playgroups, preschools or at their childminders.
The entitlement will be delivered flexibly over a minimum of three days per week.
In addition, since September 2009 most local authorities have been making the extended offer available to 25 per cent of their most disadvantaged two year olds and we will contact you if this should apply.
Our Early Years Free Entitlement Policy (EYFE)
Please click on the link below for a more complete breakdown of how the EYFE works in practice.
When your child qualifies for a free place?
The table below shows when your child will become eligible for their free early learning place.
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If your child is born between: |
They are eligible for a free place from: |
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1 April and 31 August |
1 September following their third birthday until statutory school |
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1 September and 31 December |
1 January following their third birthday until statutory school age |
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1 January and 31 March |
1 April following their third birthday until statutory school age |
How it works?
The nursery will provide up to 6 x 2.5 hour sessions free of charge per week. There will be no charge for the childcare element of the session however there will be a further charge to cover for food, drink, snacks, nappies (if needed) and toiletries. This will account for the difference between a subsidised free place and the fee we charge for that session. Our sessions are divided up into 5 hour segments and therefore it is possible for you to claim for 2 x 2.5 hour sessions back to back. Our charge for that half day session can be reduced to reflect the free entitlement if you would prefer to bring in your own food and drink. Please see the Office Manager for a fuller explanation of how this works.
The grant is paid direct to the nursery, and therefore we will not charge you for the hours funded by the Local Authority.
This benefit is available to all, regardless of income or savings. It may be split between more than one provider (including primary school nursery or reception classes) but parents are responsible for ensuring that funding is not claimed for more than six weekly sessions or 15 hours in total. We will ask you to sign a declaration to this effect, and will then put your child forward for the grant when he or she becomes eligible.
Tax Credits
Child Tax Credit is available to any family (which includes lone parents) with at least one child under 16 (or 19 if in full time education). Higher rates of benefit are available for children under the age of one or for children with disabilities. Unlike the old credits, Child Tax Credit is paid direct to the main carer (in practice, usually the mother), who does not have to be in work.
Child Tax Credit consists of a family element and a separate element for each child. The amount depends on how many children there are in the household and how much parents jointly earn. The child element is targeted at the lowest earning households but the family element is available even for relatively high earning families, although at a lower rate.
Working Tax Credit is available to anyone in work, whether or not they have children. It does, however, include an element designed to cover a substantial proportion of eligible childcare costs. Again, the credit is targeted at low earners so that benefit is reduced as household incomes rise. Working Tax Credit is paid as part of the pay packet: the employer deducts the amount of the payment from the tax which he has collected from employees before paying it over to HMRC. For the self employed, the credit is payable direct from the HMRC.
For a more detailed view of tax credits and workplace vouchers please click here.
Employer Supported Childcare (Workplace Vouchers)
The Chancellor of the Exchequer announced in his Budget Report in March 2004 that from April 2005 there would be new Tax and National Insurance breaks for employer supported childcare of up to £55 a week per parent or carer. This means that businesses will be able to help their employees to meet the cost of good quality childcare.
How will it work in practice?
Employers will be able to contract direct with a voucher company to purchase workplace vouchers on behalf of their employees. The amount of the voucher is deducted from the employee's pay (salary sacrifice) and paid over to the voucher company as a gross amount. This means that the employee does not have to bear the costs of the tax or the national insurance and similarly the employer does not pay national insurance on this element either. The voucher company then either issues a paper voucher which is sent to the employee or more commonly transfers the money directly to the nursery or other childcare setting by BACS.
Wishing Tree supported Voucher schemes
Accor, Busy Bees, Sodexho, Early Years, Leapfrog and others. We can also take transfers from self employed voucher schemes.
What are the conditions?
- The childcare used must be approved to qualify for the Tax and National Insurance exemption. This is in line with the Government's commitment to support safe, quality assured childcare.
- To qualify for the exemption employers will have to ensure that where childcare schemes operate they are generally accessible to all staff.
Additional government help may be available for lone parents or for students. We can provide telephone numbers of relevant help lines.
We accept vouchers provided by employers under a range of different schemes. Special arrangements can be made with employers who wish to provide subsidised places for staff: these may offer additional tax relief for childcare costs.