If you have a child who’s too young to go to school, you’re probably very aware that childcare is extremely expensive. According to daynurseries.co.uk, a leading UK nursery review website, placing your child into a nursery on a part time basis costs more than £8,000 a year in 2025.
If your child is in full-time nursery care, it could easily be costing you a whopping £15,000 a year. Small surprise then, that many parents cannot afford to return to work because the cost of childcare is so prohibitive.
There is some good news though, as the Government provides support with childcare costs to encourage parents who want to go back to work. Read on to discover more about three Government schemes that could help with the cost of childcare, and why they could significantly reduce the amount you pay.
1. Tax-free childcare
Under this scheme, the Government will pay 25% of the cost of your childcare up to the value of £2,000. This increases to £4,000 if your child is disabled.
You can claim the benefit if you and your partner are working and earning more than the national minimum wage. You will both need to be working more than 16 hours a week and the childcare provider must be approved by the Government.
If you’re self-employed and want to claim the benefit, you must have started your business within 12 months of making your claim. You might be able to claim the payments if you’re not working, however you will need to demonstrate that you intend to restart work within 31 days of applying for the benefit.
You can claim the benefit if you’re also receiving free childcare hours.
You cannot claim tax-free childcare payments if:
- you’re a foster parent
- you (or your partner) earn more than £100,000 a year
- the child is aged 11 or above
Please note that you may be entitled to the benefit if you and your partner’s combined income is more than £100,000.
2. Free childcare hours
If you’re a working parent and have children aged between nine months and two years, you could receive 15 hours free childcare a week. The 30 hour scheme is being rolled out to eligible working parents with a child aged between nine months and four years from this month (September 2025).
To qualify for 30 hours you will need to work an average of 16 hours a week and earn less than £100,000 a year. If you earn more than this your child will receive 15 hours a week.
You can also claim the hours if you’re on maternity, paternity, shared parental, adoption and sick leave. The scheme provides free childcare for 38 weeks, the same length of time as the annual school term time.
You could be eligible for the benefit if you or the other parent doesn’t work. The free childcare stops when your child begins a reception class or reaches compulsory school age.
The 30 hours funded childcare is not intended to cover the costs of meals, additional hours or services. While 30 hours free childcare is available in Scotland, Wales and Northern Ireland, different rules apply.
Click here to learn requirements you will need to meet in order to receive benefits in these countries.
3. Childcare vouchers
While the scheme is closed to new applicants, you can continue to claim them if you enrolled before the start of October 2018. If you’ve already received the vouchers there’s no deadline on when you need to use them.
If your employer is offering childcare vouchers, you can exchange up to £55 of your weekly salary for coupons. The vouchers can only be used to pay for an approved childcare provider.
As the money is taken from your earnings before Income Tax is charged, Childcare vouchers could help to reduce your exposure to Income Tax and National Insurance Contributions (NICs). You cannot claim the vouchers if your child is aged 15 years or over, and you cannot claim them if you take a career break that lasts for more than a year.
You can receive the vouchers if only one parent is working, however they’re not normally available to you if you’re self-employed.
Get in touch
While childcare can be expensive, so can school fees and other costs associated with bringing up a child. If you would like to discuss ways you could get more from your money to help with the cost of bringing up your children, please feel free to contact us.
Call us on 0333 010 0008 to arrange a no obligation meeting with one of our advisers, who would be happy to help.
3 September 2025