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Wednesday, 03 September 2014

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Thousands of Cumbrian families set for new tax break

More than 13,000 families in Cumbria are set to benefit from a new tax break for working parents.

Tim Farron photo
Tim Farron

Around 1.9m eligible working families in the UK are set to get up to £2,000 per child as part of the Government’s new tax-free childcare scheme being introduced in autumn 2015.

It means a family with two children under 12 could benefit by up to £4,000 a year.

In Cumbria there are 13,140 families that could be in line to receive the help, with the highest number – 2,990 – living in the Carlisle district.

In Allerdale the figure is 2,560 whilst 1,930 could benefit in Copeland. In Eden, 1,300 families are thought to be eligible.

Parents will have to open an online account, which they will pay into to cover the cost of childcare with a registered provider.

It will be done through the Government website, gov.uk.

For every 80p they or someone else pays in, the Government will top up the account with an extra 20p.

The scheme will be available for children up to the age of 12.

It will also be available for children with disabilities up to the age of 17 because their childcare costs can stay high throughout their teenage years.

To qualify, parents will have to be in work, earning just over an average of £50 a week and not more than £150,000 per year.

Any working family can use the ‘Tax-Free Childcare’ scheme, provided they meet the eligibility requirements.

It will not rely on employers offering it, unlike the current scheme Employer-Supported Childcare.

The scheme will also be available for parents who are self-employed, on paid sick leave as well as paid and unpaid statutory maternity, paternity and adoption leave.

Parents who are receiving Employer-Supported Childcare can continue to do so. There is no requirement to switch to the new scheme.

Parents won’t be able to register for Employer-Supported Childcare after Tax-Free Childcare is introduced but those registered before then will be able to continue using it for as long as their employer offers it.

Employers’ workplace nurseries won’t be affected.

Parents and others will be able to pay money into their childcare account as and when they like, making it flexible to cover times such as school holidays when families’ childcare costs may rise.

Cumbrian MP Tim Farron, who represents Westmorland and Lonsdale, said: “The announcement provides a huge boost to hardworking families.

“It comes on top of 15 hours free weekly childcare we have already delivered for all three and four year olds and pupil premium to help our schools.

“All these measures will help parents go to work and provide security for their families.”

Paying for childcare is a burden for many families.

Earlier this year the charity 4Children predicted that the average family will be spending two-fifths of their disposable income on childcare in 10 years’ time.

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