Save over a Grand on Childcare (Computershare Voucher Services)

Member Name: Pharmtastic

Product:	Computershare Voucher Services
Date:	03/09/08 (401 review reads)
Rating:

Advantages: Reduce your tax bill!!

Disadvantages: Takes a little time to set up

Busy Bees operate a system that allows you to buy childcare vouchers from them. These are then used to pay your child's [or children's] carer, rather than paying in cash.

The advantage for you is a tax break of up to £904 per year for a basic rate taxpayer, or £1,196 for a higher rate taxpayer.

The way it works is a bit complicated, but bear with me - if you pay for childcare, it might be worth it!

Work out how much you pay in childcare per month [or week, if weekly paid]. As an example, we'll assume £200 a month. You sign an agreement with Busy Bees to receive £200 pounds of vouchers each month, in place of some of your salary. Because this is taken from you salary before tax and NI, it's as though you salary is reduced and so you pay less in tax and NI.

In this example, a basic rate taxpayer saves £22 per month in NI and £40 in tax [total £62 monthly or £744 per year]; a higher rate taxpayer saves £2 NI and £80 in tax [total £82 monthly or £984 per year].

You then give the vouchers to your carer, who contacts Busy Bees: they then arrange to transfer funds directly to them, at no cost to the carer. The carer has to register first [many already are]; I have friends who've paid their carers an extra couple of hours pay to encourage them to do so, as they will save much more in the long run.

Your employer will need an agreement to run the scheme with Busy Bees - most big employers seems to have an agreement with one or another of the various companies that offer the service. [The employer benefits, too, by reducing their NI costs, so it may worth encouraging them if they're not already in.]

You can sign an agreement for several months at a time [I usually do a year at a time], so one bit of paperwork can last for ages.

The vouchers can be used for in the following cases [from the website]:


For Pre-School age children
* Registered Childminders
* Sessional or Day Care
* Playgroups
* Creches
* Local Authority and Community Nurseries
* Approved Nannies
* Approved Au Pairs

For School age children
* Childminders
* Before & After School Clubs
* Holiday Schemes

From April 2008 to April 2009, the most that can be used is £243 per month [£55 per week], though two parents can combine to double this figure.

Summary: If you pay for childcare, check it out