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Childcare costs in benefit claims

Some benefits have an element in them that allow for childcare costs that you may be entitled to.

Get childcare: step by step (GOV.UK) (opens new window)

Universal Credit

Universal Credit (UC) can include a childcare costs element if you are in paid work or have an offer of a job which will start before the end of your next monthly assessment period and the help will enable you to work. You can receive 85% of childcare costs up to a maximum of £950.92 a month for one child and £1,630.15 a month for two or more children. The child must be under 16 or has not reached the 1 September following their 16th birthday.

For couples, you must either both be in paid work or your partner is unable to look after the children due to having limited capability for work/work related activity; is a carer of a disabled person and meets the qualifying conditions for Carer's Allowance or is temporarily absent from your home. There is no limit on the number of hours you have to work for the UC childcare element.

The childcare must be approved childcare (opens new window) and you must have already paid your childcare costs and you must report your childcare costs to UC before the end of your UC assessment period following the assessment period in which you paid for the costs.

If you need help with the upfront cost of childcare when you first start work, you can ask your work coach at the Jobcentre for discretionary help from the flexible support fund.

If you are not currently in receipt of any benefits or tax credits, when you add in the cost of childcare and are on a low to middle income, you may find that this means you are actually entitled to UC - so it is worth checking.

Universal Credit childcare costs (GOV.UK) (opens new window)

Working Tax Credit

If you are already receiving Working Tax Credit (if you get Child Tax Credit already and start working enough hours for Working Tax Credit this is not a new claim, meaning you do not have to claim UC if you do not want to or would be better off remaining on tax credits) a childcare element can be included.

The childcare element pays 70% of your actual childcare costs up to a maximum of £175 for one child and £300 for two or more children. If you are a lone parent you must work at least 16 hours a week. If you are claiming as a couple, you must both be working at least 16 hours a week or one of you works at least 16 hours and the other counts as being incapacitated due to sickness or disability (see, is entitled to Carer's Allowance or is not at home due to being in prison or hospital.

Housing Benefit

If you are not in receipt of Income Support, income-related ESA, income-based JSA, UC or the guarantee credit of Pension Credit you may be entitled to an earnings disregard for childcare costs in your Housing Benefit claim. This will apply if you are a lone parent working 16 or more hours per week or a couple who both work 16 hours or more per week or one works 16+ hours and the other is 'incapacitated', in hospital or prison.  

The disregard is applied in addition to any childcare costs you receive in Working Tax Credit. An earnings disregard for your childcare costs of up to a maximum of £175 for one child and £300 for 2 or more children can be applied.

If you have started needing help with childcare costs in your Housing Benefit claim, you can report the change in your circumstances: Report a change of circumstances which may affect your benefits

Tax-free childcare

This is only for people whose income is too high for UC or Tax Credits and cannot be received at the same time. Always check your benefit entitlement first as in most cases you will be better off making a claim for UC or continuing to claim Tax Credits to get assistance with your childcare costs.

Tax-Free Childcare (GOV.UK) (opens new window)

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