Are you missing out on free childcare? The Tax-Free Childcare scheme

As any parent will be aware, there have been various changes over the last couple of years to the amount of free childcare being offered in the UK. 

The most recent changes were in September, when childcare hours for working parents were increased from 15 to 30 per week. But are you fully up to date with all of these changes? Are you and your family now eligible for more childcare than you were previously? And, if so, how do you go about arranging this free childcare?

In this article we try to answer those questions to help you ensure that you are not missing out on free childcare if you are eligible to have it.

Who is eligible for free childcare in the UK?

There are 15 or 30 hours of free childcare available, depending on the age of the child and the employment status of the parents. Here’s a quick summary:

• If one or both parents are working

Free Childcare for Working Parents provides 30 hours per week of free childcare for 38 weeks of the year if your child is aged between 9 months and 4 years old. Your annual earnings also need to be more than £9,518, but less than £100,000. 

If you are a parent but don’t work yourself, you may still be eligible if your partner is working, and you receive any of the following benefits: 

• Incapacity Benefit 
• Severe Disablement Allowance 
• Carer’s Allowance 
• Limited Capability for Work Benefit 
• Contribution-based Employment and Support Allowance.

• If your child is aged 2 and one or both parents are on certain benefits

Families on the following benefits can get 15 hours of free childcare a week for 38 weeks of the year for a 2-year-old child: 

• Universal Credit (if your household income is £15,400 a year or less after tax – not including benefit payments);
• Income Support;
• Income-based Jobseeker’s Allowance (JSA);
• Income-related Employment and Support Allowance (ESA);
• The guaranteed element of Pension Credit;

You are also eligible for this free childcare if your child:

• has an EHCP – Education, Health and Care Plan;
• gets Disability Living Allowance (DLA);
• has left care under an Adoption, Special Guardianship or Child Arrangements order.

• If your child is aged 3 or 4

In England, all three and-four year olds are eligible for 15 hours of government-funded childcare, regardless of their parents’ working status. If your child is between 3 and 4 years old and you live in England, you can get 15 hours of free childcare a week for 38 weeks of the year.

How do you claim free childcare?

The process is slightly different depending on which type of free childcare you are applying for:

• Free Childcare for Working Parents

You can apply for Free Childcare for Working Parents from when your child is 23 weeks old. However, the funding will not start until the beginning of the term after your child reaches 9 months old.

There are three terms during the year, starting on 1st September, 1st January and 1st April. You need to apply by the application deadline before the term you want the childcare to start. If you miss the deadline, your funding will not start until the following term. 

Deadlines to apply for a place at the start of term are the day before term starts, as follows:

So if you want a place for your child in January 2026 you must apply by 31st December 2025. 

You need to apply online at Gov UK. When your application is approved, you will be provided with an 11-digit code that you need to give to your childcare provider.

• If your child is aged 2 and one or both parents are on certain benefits

Families eligible for this childcare can apply close to the date of your child’s 2nd birthday, and your childcare hours will start the term after your child turns 2, as follows:

So if you want a place for your child in January 2026 you can apply from 1st September 2025. 

To apply, contact the early years team or Family Information Service at your local council.

• If your child is aged 3 or 4

All 3 to 4-year-olds in England are eligible for this childcare, you do not need to apply. Your childcare provider will sort out the funding for you. However, you will need to show them a copy of your child’s birth certificate and you will also be asked to sign a parental declaration form. 

How do you find childcare for your child?

There has been a lot of media coverage recently of the potential shortage of childcare places, particularly since the September doubling of free childcare to children of working parents. So the earlier you can identify a childcare provider and secure your child a place – or at least get on the waiting list – the better.

It is completely up to you to decide the kind of childcare you want for your child. Your childcare funding can be used to pay towards any kind of childcare as long as it is provided by an approved supplier. This includes:

• A private nursery;
• A private or state-run pre-school;
• A registered playscheme or club; 
• A registered childminder or nanny;
• A registered home care agency.

The Tax-Free Childcare scheme

Also be aware that, in addition to the free childcare schemes mentioned above, there is also The Tax-Free Childcare scheme. It can be used as well as free childcare hours if you need to spend more on childcare than the free hours.

The Tax-Free Childcare scheme is available to working parents who earn between national minimum wage and £100,000 per year. Under the scheme, the government will pay 25% of the childcare costs for each of your children, up to a maximum of £2,000 per child per year (£4,000 for disabled children). 

You can find out more about the Tax-Free Childcare scheme on the Gov UK website.

We hope that this article has provided some useful information about the recent changes in free childcare in the UK, and what help is available to you.

If at any stage you need any additional funding to sort out family finances, remember that Loans 2 Go offer a range of personal loans which may be able to help.

For more useful financial and lifestyle tips for your family, visit us here again soon at Loans 2 Go.