This help centre article has been written for Koru Kids' Home Nursery service


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What is Tax-Free Childcare?

Tax-Free Childcare allows families to claim 20% of their childcare costs from the government. This means you are eligible for a maximum of £2,000 per child per year (£4,000 for a child with a disability) top-up from the government to pay for childcare costs from Ofsted registered childcare providers.

All Koru Kids home nurseries are able to accept Tax-Free Childcare payments. Please note, if you employ a Koru Kids nanny they will likely not be registered with Ofsted (due to the part-time nature of the role) and we will be unable to accept these payments.

The scheme is available to parents of children under the age of 12. Children stop being eligible on 1 September after their 11th birthday (under age 17 for children with disabilities). Adopted children are eligible, but foster children are not.

In short, for every £8 you pay into your account, the government will give you £2, up to a maximum of £2,000 per year per child. If you put £8,000 in your Tax-Free Childcare account over the course of the year, the government will top up that amount by £2,000, giving you £10,000 to spend on your registered childcare provider!

You can pay into your account at any time and receive the top up, but a key thing to know is that you can only receive up to a maximum of £500 top-up per quarter (£2,000 top up per year). These figures increase to £1,000 per quarter (£4,000 per year) if your child has a disability.

Other people such as family, friends, and employers can also pay into the account. Payments can be made directly to the childcare provider through the online account.

If you have more than one child in childcare you will need to open an account for each child, although you can do this as part of a single application

Am I eligible for Tax-Free Childcare?

The best way to check if you're eligible for Tax-Free Childcare is to check the government website.

The main criteria are that both parents must be in employment (or one parent in a single-parent household) earning between £142.56 per week and £100,000 per year.

How to apply for Tax-Free Childcare

You will need to open a Government Gateway account through the childcare service. You will need to have the following information to hand:

  • Your National Insurance number and date of birth

  • Your partner’s National Insurance number and date of birth (if applicable)

  • A payslip, P60 form or passport

  • Each child’s date of birth

  • The date you and your partner (if applicable) started your most recent employment (this can be an approximate date provided the employment has been for more than three months).

Your application will be assessed by HMRC who will let you know if you are eligible for Tax-Free Childcare. This can take up to 10 days.

You will need to reconfirm that you are still eligible for Tax-Free Childcare every 3 months using your childcare service account. You can do this by ticking a box to confirm that your details have not changed. You will be reminded to do this 4 weeks before the reconfirmation deadline.

If you have any queries regarding the process, you can contact the Childcare Service Helpline on 0300 123 4097.

How do I pay into my Tax-Free Childcare account?

You will be able to make one-off payments into each Tax-Free Childcare account or you can set up a standing order to make regular payments.

The government will apply the top-up automatically (as long as you haven't reached your £500 per quarter limit), and it should be received instantly. You will then be able to use the full balance to pay for your childcare.

You will be able to pay up to 10 childcare providers from each Tax-Free Childcare account. You will need to make a separate payment for each eligible child if you have a number of children at one childcare provider.

If you are no longer eligible for Tax-Free Childcare you will still be able to add money to the account but will not receive any government contributions. You will still be able to use the balance in the account to pay for childcare.

If you no longer want to use the Tax-Free Childcare account you can withdraw your money but the government will take back its contributions.

How do I pay Koru Kids using Tax-Free Childcare?

In the Tax-Free Childcare online portal, you need to click on the green button which says ‘add a new childcare provider’.

You can then search for “Rua Kids” (our corporate name) and add us to your provider list.

On your invoice each month, there will be a ‘to pay’ balance that is your childcare costs after any deductions for Funded Hours or Childcare Vouchers. This balance needs to be paid either through the Tax-Free Childcare portal by you or via direct debit.

When your child starts with Koru Kids you’ll let us know which method you prefer and you can change it at any time by contacting our customer service team at care@korukids.co.uk.

What if I stop being eligible?

If you are no longer eligible for Tax-Free Childcare, you will stop receiving the government top-up for any funds that you add to your Tax-Free Childcare account.

You can choose whether to continue paying your invoice balance each month through Tax-Free Childcare or switch to Direct Debit if that is easier. Please let us know your preference by contacting us at care@korukids.co.uk.


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