Childcare Voucher Scheme Extended

On 29 March 2018, new regulations were published by the Government specifying 4th October 2018 as the date by which new entrants to existing employer-supported childcare schemes must have sacrificed salary and received childcare vouchers to be treated as an eligible employee.

Existing childcare schemes were due to close to new entrants from April 2018. However, on 13 March 2018, the government announced that closure would be deferred for six months.

Eligible employees can continue to sacrifice salary, on which no income tax or National Insurance contributions are payable, and receive tax exempt vouchers, provided that they remain with the same employer, the employer continues to run the scheme, and the employee does not take a break from receiving vouchers for a year or more.

Employees who are not eligible employees are instead entitled to participate in the replacement tax-free childcare voucher scheme that does not involve any form of salary sacrifice. The new scheme was announced on 19 March 2013 and launched on 21 April 2017.