Childcare help with costs- with your employer

Childcare has always been expensive and it just keeps rising yesterday a report came out regarding a new incentive to help parents. I have over 20 years of helping parents when i ran a nanny agency and often we would discuss costs and how splitting child care options over the week could often be cost effective.There are many avenues to explore on the type of childcare you can use

1. Nannies: full time, part time or after school care

2. Day nurseries: full time part time or some offer after school care

3. Childminder; Full time, part time or some offer after school care

4. Parents

5. After school clubs for older children

6. Nanny share: Either two families using one nanny or a nanny who wishes to take their own child to work.

So you may use a nanny or nursery place for a few days and if parents are able ot help out a couple of days for them to assist. Some parents needed the flexibility of a nanny but also combined this with parents or a nursery. So there are lots of options to explore.

Today's report by Hollie Borland, Senior Digital Consumer Reporter Jan 2020, updated: 7 Jan 2020, 15:34

PARENTS can borrow up to £10,000 interest free to help them pay for childcare in a new employee benefits scheme.But in order to take advantage of the help, your employer must be signed up to it.1

Parents can get an interest-free loan to help with childcare costs Credit: Getty - Contributor Parents face forking out up to £12,000 a year to put a two-year-old child in nursery full-time, according to charity Coram Family and Childcare. But a new scheme launched by

has promised to help parents cover the costs by offering them an loan without charge. The Childcare Cash Advance Scheme works in the same way that many interest-free rail season ticket loans schemes do, which some employers already offer.

Parents with early years and school aged children can borrow the money upfront and pay it back over 12 months.

How to apply for tax-free childcare

YOU can use the Government's childcare calculator to work out what help you might be entitled to.

You can find this tool on Gov.uk.If it looks like you will be eligible, you can apply online.

You’ll need your details (and your partner’s, if you have one), including your national insurance number and unique taxpayer reference (UTR), if you’re self-employed It takes 20 minutes to apply and you'll find out if you qualify within seven days. Be aware that you have to apply for both tax-free childcare and 30 hours of free childcare at the same time. If you're eligible you'll get a childcare account. You can use this to pay your childcare provider. To continue getting the benefit, you must confirm your details are up to date every three months. The loan is managed through Catapillr's online hub and can also benefit from a 20 per cent boost as it can be paid into the government tax-free childcare scheme. This is where parents pay into an account with a childcare voucher provider, which the government then tops up. The loan will help parents with irregular income meet the cost of childcare, particularly in situations where providers ask for more than a month's worth of fees in one go. It may also benefit those who claim Universal Credit and are struggling to meet the upfront costs of childcare. The Universal Credit covers up to 85 per cent of childcare costs but it's awarded to claimants as back pay. The loan will mean that childcare costs are covered upfront, helping those overcome the financial barrier of childcare to get back into work. But parents won't be able to claim the costs back from Universal Credit if they chose to use the loan instead. Catapillr founder Phil Robinson told The Sun that the idea was founded based on his own experience of struggling with the cost of childcare for his three young sons. He added: "Our aim is to make childcare cheaper and easier to manage for working parents."

But parents' who's income regularly can't meet the cost of childcare should be wary of taking out a loan because they will still need to be paid back.

What help is available for parents?

CHILDCARE can be a costly business. Here is how you can get help.

• 30 hours free childcare - Parents of three and four-year-old can apply for 30 hours free childcare a week. To qualify you must work at least 16 hours a week at the national living or minimum wage and earn less than £100,000 a year.

• Tax credits - For children under 20, some families can get help with childcare costs.

• Tax-free childcare - Available to working families and the self-employed, for every £8 you put in the government will add an extra £2.

It's not a salary sacrifice scheme and the loans are repaid by regular deductions taken directly from a worker's net pay. This means it won't affect Universal Credit payments as they are calculated on monthly gross pay. Finance expert Kate Smith from Aegon warns that even though loans like this can be a "lifesaver" for some parents, they should also be treated the same as any other. She said: "Just like any loan, people need to keep tabs on any repayments and ensure they don’t build up too much debt and have the ability to manage their finances. "Although interest free, the childcare loan needs to be paid back within a year, and it’s paid direct from employee’s wages, so there is little flexibility. "Employees could feel they are effectively tied to their employer." Parents who want to use the loan to benefit from the tax-free childcare scheme will have to manually transfer the money into their account. You'll also need to pay your childcare provider directly through the portal by selecting the service from a drop down menu. These include all Ofsted registered childminders, nannies, nurseries and professional children's activities and after school clubs, holiday clubs and sports activities. But while it's free for borrowers to use, employers are charged a fee typically £100 a year per loan.