SCHOOL holidays can be a costly nightmare for parents trying to plug gaps in childcare arrangements.
But extra help is available that can ease some of the pain, including tax breaks worth thousands of pounds, free childcare hours and government grants.
To tap into government help you will need to use an approved childcare provider.
Nurseries, pre-schools, nannies, childminders, registered schools and clubs are among the providers that can be approved.
And you can easily use the Ofsted website to check if your childcare provider of choice has been approved.
The government has a childcare costs calculator which is a sensible first port of call to find out how to save the most cash, as not all schemes can be used at the same time.
Laura Suter head of personal finance at AJ Bell, said: "There is lots of help out there with childcare costs, and it doesn’t end when your children start school – so if you’re not claiming any Government support you should definitely do some research to see what you’re entitled to."
Universal Credit childcare costs
If you claim Universal Credit, you could get a refund on childcare costs.
You can currently claim back 85% of childcare costs up to £646 a month for one child or £1108.04 for two or more up to August 31 following the child’s 16th birthday.
This works out at around £969 over the six weeks of the summer holidays.
You currently have to pay your childcare costs yourself up front and then claim the money back through Universal Credit.
However, this is changing and parents on Universal Credit will get a monthly £522 boost to childcare payments from June 28.
At the same time, childcare costs will be paid for upfront.
The maximum amount of cash parents can claim will go up from £646 to £951 for one child, and from £1,108 to £1,630 for two - an increase of just under 50%.
Over a six week period that amounts to £1,426 for one child or £2,445 for two.
Tax-free childcare
Working parents earning less than £100,000 get up to £500 every three months - up to a maximum of £2,000 a year - for each of your children to help with the costs of childcare up to the September after their 11th birthday.
You pay money into an account and for every £1 you put in the Government will add 25p.
If you have a disabled child you can get double the amount and it runs until the September 1 after their 16th birthday.
Laura says: “Even if you’re not currently working, check the small print as you might still be entitled, if you’re on sick leave, parental leave or on certain benefits.
“If you know that summer holiday costs are going to be high it’s a good idea to pay money into the account ahead of time and build up funds in there.
“Not only will this help to spread the cost of summer childcare but you’ll also benefit from more Government bonus as it could span two, or more, three-month periods.”
You usually can’t claim tax-free childcare if you receive working tax credit, child tax credit, Universal Credit or childcare vouchers.
And tax credits stop immediately if you successfully apply for tax-free childcare, and you’ll also have to cancel your Universal Credit and childcare vouchers.
Use the government’s calculator tool to work out the best option for you.
15 hours free childcare
All three to four year old children in England are entitled to 15 hours of free childcare - amounting to 570 hours per year - from the term after their 3rd birthday.
The free allowance is usually taken as 15 hours per week for 38 weeks of the year, but that can be changed to suit you.
For example, taking fewer hours over more weeks.
The free hours must be with an approved childcare provider and stops when your child starts school.
Parents are expected to cover extra costs like meals, nappies or trips.
30 hours free childcare
Working parents may be eligible to get a further 15 hours of free childcare for their three to four-year-olds.
To qualify you must be working at least 16 hours a week on average and earning the National Minimum Wage or more.
For example, over the next three months you expect to earn at least £2,1675 if you’re 23 or over.
If you have a partner, they’ll need to expect to earn at least this much too.
You can get 30 hours of free childcare per week for 38 weeks of the year - during school term time.
You may be able to get free childcare for 52 weeks if you use fewer than 30 hours per week.
Check with your childcare provider to find out if this is something they offer.
You can apply online through the government’s website.
Once the application has been approved, you’ll get a code for 30 hours free childcare to give to your childcare provider.
Free childcare for two-year-olds
Parents living in England and claiming certain benefits can also access free childcare for their two-year-olds.
You are entitled to the extra free childcare if you currently receive:
- Income Support
- Income-based Jobseeker’s Allowance (JSA)
- Income-related Employment and Support Allowance (ESA)
- Universal Credit, and your household income is £15,400 a year or less after tax, not including benefit payments
- Tax credits, and your household income is £16,190 a year or less before tax
- The guaranteed element of Pension Credit
- The Working Tax Credit 4-week run on (the payment you get when you stop qualifying for Working Tax Credit)
However, you may still have to cover extra costs like meals, nappies or trips.
Help if you’re still in education
There are also some lesser known schemes to help young parents who are still in education pay for childcare costs.
If you’re under 20 and in school or Sixth Form you may be eligible for weekly payments through the Care to Learn scheme, which is designed to help out over the summer holidays.
This could give you up to £180 a week, or £195 in London, towards childcare and is paid directly to your provider.
If you’re over 19 and in further education you can apply for Discretionary Learner Support, which can be used to pay for childcare and other costs such as accommodation and travel.
And university students on full-time courses can apply for grants to cover childcare costs for children younger than 15.
