Answers · UK 2025/26
Does Universal Credit pay back my childcare costs and how much can I claim?
Universal Credit refunds up to 85% of your registered childcare costs, capped at GBP 1,031.88 a month for one child or GBP 1,768.94 for two or more children in 2026/27. You usually pay first and claim the money back, and it is separate from the earnings taper that reduces the rest of your award.
Full answer
The childcare element of Universal Credit (UC) reimburses up to 85% of what you actually pay for registered or approved childcare, so long as you (and your partner, if you have one) are in paid work or about to start. For 2026/27 the maximum refund is GBP 1,031.88 a month for one child and GBP 1,768.94 a month for two or more children. Worked example: a single parent pays GBP 900 a month for one child's nursery. UC refunds 85% = GBP 765, leaving them GBP 135 a month to find. If costs were GBP 1,300 for one child, the 85% would be GBP 1,105, but the GBP 1,031.88 cap applies, so they get GBP 1,031.88. The childcare element is added on top of your standard allowance and is not reduced by the 55% earnings taper that cuts the rest of your UC as you earn more, although your overall award still falls as earnings rise. You normally pay the provider first and report the cost, then UC pays you back, which can cause cash-flow strain; in some cases the Flexible Support Fund or an advance can cover upfront or deposit costs. You cannot use UC childcare support and Tax-Free Childcare at the same time, so compare which leaves you better off. Childcare must be from a registered or approved provider. Use the budget planner to manage the pay-first gap. Check the caps and report costs at gov.uk/universal-credit.
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This answer is informational only and does not constitute financial, tax or legal advice. Figures are for the 2025/26 UK tax year. See our methodology and sources.