HM Revenue and Customs (HMRC) is encouraging parents to sign up for Tax-Free Childcare during the summer holidays, after new figures revealed a record number of families are now using the support. The scheme offers working parents up to £2,000 per year per child towards approved childcare costs.
Latest statistics show 868,095 families benefited from Tax-Free Childcare in the 2025-26 tax year, with the UK Government providing almost £600 million in top-up payments. Under the scheme, for every £8 paid into an account, the government adds £2, meaning eligible parents can receive up to £500 every three months per child. Families with a disabled child can receive up to £1,000 per quarter, totalling £4,000 annually.
Myrtle Lloyd, HMRC's Chief Customer Officer, said: 'I'm so pleased these figures show more families than ever are using Tax-Free Childcare to save on their bills. £2,000 is not a small amount and it can make a real difference. If you haven't signed up yet, don't miss out.'
The money can be used to pay for approved providers including nurseries, childminders, before and after-school clubs, and holiday activity clubs. Families are eligible if they have a child aged 11 or under, or up to 16 for disabled children. Parents and their partner must each earn at least the equivalent of 16 hours a week at minimum wage, and no more than £100,000 a year each.
Families receiving Universal Credit or childcare vouchers usually cannot claim Tax-Free Childcare. HMRC advises using the online childcare calculator on GOV.UK to check eligibility. Applying takes just 20 minutes, and once an account is opened, money can be deposited and used immediately or withdrawn at any time.
