HMRC has confirmed that working parents across the UK could receive boosts of up to £2,000 per child through its Tax-Free Childcare scheme. The scheme, run by the government's tax arm, is available to many of those earning below £100,000 and is designed to help families reduce their childcare costs.
To qualify, parents must have a child aged under 11, or under 16 if the child has a disability. The savings can be used towards school clubs, childminders and other wraparound childcare provision.
How the scheme works
A recent post on X, formerly Twitter, from the official GOV UK account explains: "The government adds £2 for every £8 you pay in, up to £2,000 a year per child (or up to £4,000 if your child is disabled)."
The post adds that parents can apply online to open a childcare account and must reconfirm their eligibility every three months. The scheme is worth up to £2,000 per child each year, or up to £4,000 for children with additional needs, reports Birmingham Live.
Usage and payment details
According to the most recent figures, 602,000 families were making use of Tax-Free Childcare for 745,000 children in June 2026. Families can select from thousands of childcare providers that now accept Tax-Free Childcare as a form of payment, including wraparound care or childminders for arrangements during term time, or holiday clubs and activities throughout school breaks.
Once an account has been set up, parents can deposit money to use immediately or leave it in the account until required. Money can be transferred into the account by Direct Debit, standing order or bank transfer, with payments typically appearing within one working day, and the government's contribution added at the same time.
Parents must log in to their childcare account every three months to confirm they are still eligible. If they do not, their Tax-Free Childcare will cease.
