826,000 families boost finances with childcare savings

Almost 826,000 UK families shared £632.2 million in government top-ups towards their
childcare bills with Tax-Free Childcare in the 2024 to 2025 tax year
Working families urged to sign up now to give their summer plans a financial boost
Supporting the government’s mission to grow the economy and deliver on the Plan for
Change
Nearly 826,000 working families saved up to £2,000 per child with Tax-Free Childcare in the 2024 to
2025 tax year. The money helps families pay for their childcare, as part of the government’s Plan for
Change to put more money in people’s pockets.

HM Revenue and Customs (HMRC) is encouraging those yet to sign up for Tax-Free Childcare, to
do it now and give their summer plans a financial boost.

Latest figures from HMRC show in March 2025, 21,420 families in Wales used the scheme to save
on their annual childcare bills, an increase of 2,730 families compared to the previous March.

Working families who sign up to Tax-Free Childcare can boost their annual budget by up to £2,000
per child up to the age of 11 or up to £4,000 up to the age of 16 for a disabled child.

Parents can use the scheme to help towards the cost of approved childcare whether that’s nursery
for younger children, or for older children – wraparound or after school care clubs during term time or
holiday clubs for the long summer holidays ahead.

Myrtle Lloyd, HMRC’s Director General for Customer Services, said:
“Summer can be an expensive time if you have children. Whatever you’re planning, Tax-Free
Childcare can give your plans a welcome financial boost. Go to GOV.UK to start saving today.”
For the attention of Newsdesks & personal finance correspondents No. of pages: 3
Date: 6 June 2025 Ref: WAL 21 25

For every £8 deposited in a Tax-Free Childcare account, the government tops it by £2, which means
parents can receive up to £500 (or £1,000 if their child is disabled) every 3 months towards paying
for their childcare costs.

Once families have opened a Tax-Free Childcare account, they can deposit money and use it
straight away or keep it in the account to use it whenever it’s needed. Any unused money in the
account can be withdrawn at any time.  

Families could be eligible for Tax-Free Childcare if they:  
  
have a child or children aged 11 or under. They stop being eligible on 1 September after their
11 th birthday. If their child has a disability, they receive up to £4,000 a year until 1 September
after their 16 th birthday the parent and their partner (if they have one) earn, or expect to earn, at least the National Minimum Wage or Living Wage for 16 hours a week, on average   each earn no more than £100,000 per annum   do not receive Universal Credit or childcare vouchers   
  
Visit GOV.UK to check eligibility and register for Tax-Free Childcare.

Tax-Free Childcare can be used alongside the free childcare hours subject to eligibility.