Answers · UK 2025/26
How does Tax-Free Childcare work in 2026/27?
Tax-Free Childcare gives you £2 from the government for every £8 you pay into an online childcare account, up to £2,000 per child per year (£4,000 if disabled). For 2026/27 each parent must earn at least the equivalent of 16 hours at minimum wage and under £100,000 a year.
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Tax-Free Childcare is a government top-up scheme run through an online childcare account. For every £8 you pay in, the government adds £2, which is a 20% boost that mirrors basic-rate tax relief, hence the name. The maximum top-up is £500 every three months per child, which is £2,000 a year, rising to £1,000 every three months (£4,000 a year) for a disabled child. You can use the account to pay any registered childcare provider, including nurseries, childminders, after-school clubs and holiday camps. To qualify, each parent in the household must generally be working and expect to earn at least the equivalent of 16 hours a week at the National Minimum or Living Wage over the coming three months, and neither parent can have an adjusted net income above £100,000 a year, or you lose the whole entitlement. It is available for children up to the age of 11, or 16 if the child is disabled. You must reconfirm your eligibility every three months. Importantly, you cannot use Tax-Free Childcare at the same time as Universal Credit childcare costs, the older childcare vouchers scheme, or tax credits, so you should compare which gives you more. Families using a lot of paid childcare usually gain most. The crossover with the £100,000 income limit means that, as with the personal allowance taper, pension contributions that reduce adjusted net income below £100,000 can preserve eligibility. Use the take-home pay calculator to check your adjusted net income against the £100,000 limit.
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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.