How does the Universal Credit childcare element work and how much can I claim?

Full answer

The childcare element of Universal Credit helps working parents with the cost of registered or approved childcare, such as a registered childminder, nursery, after-school club or approved home childcarer. It covers up to 85% of what you actually pay, with the remaining 15% met by you. It is added to your standard UC award and any other elements you qualify for. Who it affects: UC claimants who are in paid work. In a couple, both partners normally need to be working, although exceptions apply where one cannot provide childcare themselves -- for example due to illness, disability or caring responsibilities. There is no minimum number of hours you must work to qualify. How payment works: traditionally you pay the childcare provider and then report the cost to UC, which reimburses 85% in the following assessment period. Because paying upfront can be difficult, support may be available to help with the initial costs and deposits -- ask your work coach. Keep receipts and report costs in the assessment period in which you pay them. There are monthly maximum amounts -- one cap for one child and a higher cap for two or more children. These figures are set by the Department for Work and Pensions and are not part of this rate card, so confirm the current monthly maximums and how the taper interacts with the rest of your award on gov.uk before relying on a number. Important interaction: you cannot use Tax-Free Childcare at the same time as the UC childcare element, and claiming UC can affect other support, so compare the options. The childcare element is also separate from the free childcare hours scheme, which you may be able to use alongside it. Because UC reduces as your earnings rise (the taper), it is worth modelling your net position; use a take-home pay calculator to see your after-tax earnings, which feed into the UC calculation.

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