Childcare vouchers are a Government initiative to help working parents. The most common method of offering childcare vouchers is through your salary; parents elect to take part of their existing salary as childcare vouchers. Your employer then orders your vouchers and you receive them electronically on the day specified, usually your payday. You then use these e-vouchers to pay your childcare provider directly online.
In order to make the savings you must sign a salary sacrifice contract with your employer to vary the terms of your employment, this is in order to receive part of your pay in childcare vouchers. The earnings you exchange for childcare vouchers are gross, so there is no tax or NI to pay.
Salary sacrifice is when you give up the right to part of your pay in return for a non-cash benefit e.g. childcare vouchers. The contract to receive tax and NI free childcare vouchers usually lasts for at least a year. Once the contract has expired or you withdraw from the scheme, you will revert to your original salary.
Childcare vouchers are free from tax and NI contributions for the value of vouchers you order. The amount you can salary sacrifice depends on your earnings threshold:
Total Earnings*/ Rate
|Amount you can take|
Up to but not exceeding £46,350 (basic)
Over £150,000 (additional)
*Total earnings include salary, other taxable benefits and a standard personal allowance. Please speak to your HR department if you are unsure of the value of tax and NI exempt childcare vouchers you are entitled to take.
Amount (per year)
Up to but not exceeding £46,350 (Basic)
*These savings are subject to changes by HMRC
Your employer will register with us to provide childcare vouchers. You will then be able to set up your personal account. When your employer orders vouchers for you, they will be credited to your account and you can then use this to pay your children’s childcare provider directly.
You will automatically stop receiving childcare vouchers, but you may still use any stored vouchers before they expire.
Working parents / guardians, both men and women, provided that income does not fall below the national minimum wage (NMW) or National Living Wage (NLW) by receiving childcare vouchers.
Yes, the amount of vouchers that a parent can take is limited to the amounts illustrated below, irrespective of how many children you have. So you could maximise your savings by ensuring that you both take part in a childcare voucher scheme. If your partner’s employer is not currently running a scheme, call us on Freephone 0800 328 7411 and ask for more information.
You can pay for as many children and childcare providers as you wish with your vouchers, but the amount of vouchers that can be taken is limited to the specified amounts. If both parents claim vouchers, the benefit is doubled
A parent / guardian is someone who maintains a child or stepchild (wholly, or partly) at their expense or who has parental responsibility for a child who resides with them. Grandparents, unless legal guardians, are not eligible to receive childcare vouchers.
A person is considered a child until the 1st September following his / her 15th birthday, or 16th birthday if he / she is disabled.
You may pay for any registered childcare with childcare vouchers. Check that your childcare provider is registered with the relevant body.Registered childcare includes:
- Day care
- Before and after school care
- Holiday schemes
- Sitter services (Scotland)
- Activity based care e.g. sports and drama coaching
- Ofsted (England)
- Care Inspectorate (Scotland)
- Care and Social Services Inspectorate (Wales)
- Department of Health, Social Services and Public Safety (Northern Ireland)
Parents, step parents and guardians may not receive childcare vouchers as payment for childcare. No other relative of the child may be paid with childcare vouchers unless they run a registered childcare business, such as a nursery, and the care is not provided in the child’s home.
Yes, childcare vouchers can be used to pay for Reception year fees in private schools prior to a child reaching the compulsory school age of 5. A child is of ‘compulsory school age’ the school term after a child’s 5th birthday e.g. if a child has their birthday in February, childcare vouchers can be used to pay for childcare until the end of the Spring term. They can also be used to pay for before and after school care for older children at a private school and also for the boarding element of boarding school fees, providing that these elements are invoiced separately
Yes. You may use childcare vouchers if your Local Authority does not cover all of your childcare costs.
You can pay as many childcare providers as you wish providing they are registered with Sodexo Motivation Solutions. If you wish to add a childcare provider to your account, simply go online and add them using our comprehensive system. Should one childcare provider charge more than £243 then you may find it easier to use all your vouchers / voucher credit for that one provider....
Vouchers are usually received monthly and dates vary depending on your chosen delivery method.
Should your childcare costs exceed your childcare vouchers you may either pay the balance directly to your child carer or use our flexible top up feature, which enables you to top up your voucher balance with your own money. This not only allows you and your child carer to keep track of your payments more easily but your child carer will receive just one payment from you rather than two. To ensure both receipts into your voucher account are correct, from you and your employer, and any refunds made to you are accounted for, we will track both receipts separately to avoid any miscalculations.
Voucher top-ups allow you to top-up your voucher account balance with your own money using your debit card. This means that when your childcare costs exceed the value of your vouchers you can make a single payment (per month) to your child carer directly from your account.
Register all your childcare providers with Sodexo and work out how much you need for each provider throughout the year, add it up and divide by 12 to give a monthly amount. You may find an online account the easiest way to store and save credit
HMRC guidance suggests that you can leave the scheme at any time. However, we ask that you stay for a minimum of one month to avoid unnecessary administration. It is also worth bearing in mind that your employer may not allow you to re-join the scheme for a specified period of time.
Vouchers last for up to 30 months, so you can save them up for times when you may need extra childcare throughout the year. All vouchers expire on their expiry date. Once they have expired they will still display on your account but you will need to validate who you are, your child’s details and who you are paying and they will then be simply re-issued.
Refunds are not possible under salary sacrifice contracts. Once your pay has been exchanged for a childcare voucher under contract it is generally not possible to reverse it back through the payroll. In circumstances where a refund is allowed, the refund would be returned to your employer and paid to you through payroll and would be subject to tax and national insurance in the normal way.
Tax Free Childcare is a government scheme for working parents with children under 12 (or 17 if disabled). The government will top up your online account with an extra £2 for every £8 you pay in. You can receive up to £2,000 per child based on a maximum childcare cost of £10,000 or up to £4,000 per disabled child based on a cost of £20,000 per year.
For more information,Click here
From 5th October 2018, the childcare voucher scheme is closed to new joiners
You can-rejoin the scheme if you were previously in the childcare voucher scheme in the following scenarios:
- If you are currently in the childcare voucher scheme you can temporarily stop your payroll deductions. You have a 12-month window to re-join the scheme provided you have not joined TFC in the meantime.
- If you have been in the childcare voucher scheme within the last 12 months, but are currently not receiving vouchers, you have until 11 months after your payroll deductions stopped to re-join, provided you did not join TFC in the meantime.
Yes, after 4th October 2018, when the childcare voucher scheme is closed to new entrants, you can vary your voucher amount in the same way you have always been allowed to.
No, childcare vouchers are per parent whereas TFC is per child, therefore both parents need to be in the same scheme.
If you change employer after 4th October 2018 you will be classed as a leaver to the childcare voucher scheme and will not be allowed to join your new employer’s scheme.
You can use up your childcare voucher balance, irrespective if you have joined TFC.
Yes you can. The Childcare Choices website has had some issues and has wrongly been stating that a parent cannot claim both during the quarterly eligibility confirmation process on the Childcare choices website. If you experience this, please contact HMRC.
You can re-join the voucher scheme provided you do so within 12 months and provided you have not joined the Tax Free Childcare scheme in that period.
Yes. We comply with all relevant data protection legislation and are committed to only using your personal data for the purposes of providing our childcare voucher services. We will never pass your information on to third parties.
Phone: 0800 328 7411*
Address: Sodexo Motivation Solutions, Unit 5 Albany Court, Albany Park
Frimley Road, Camberley, Surrey GU16 7QR
*Please note all calls are recorded for training and quality purposes.
Your vouchers may or may not appear on your payslip. Often your salary is shown with the voucher cost deducted and the voucher value is shown separately. The reduced tax and National Insurance contributions are then shown on the opposite side of the payslip.
The impact on the state pension scheme is likely to be negligible. Most other pension providers are happy to accept childcare vouchers as notional pay. Ask your employer for confirmation of whether your pension contributions are affected. If you are contributing to a personal pension, you are unlikely to be affected by taking childcare vouchers, but we recommend that you seek advisement on this.
You have 3 options in relation to your childcare vouchers whilst on maternity leave:
Option 1 - You can withdraw from the childcare voucher scheme. If you do so prior to the period in which SMP is calculated (the 'qualifying period'), your SMP calculations will be based on your higher salary (not including your salary sacrifice deductions). This period begins at approximately week 17 of your pregnancy.
Option 2- You can opt out of the childcare voucher scheme during the qualifying period, so your SMP calculations are based on your higher salary, and then re-join the scheme afterwards. The qualifying period lasts for 8 weeks and is approximately between weeks 17 and 25 of pregnancy. If you will be receiving contractual or occupational maternity pay, you may continue to salary sacrifice until your pay reverts to SMP/SAP. Please note that childcare vouchers cannot be deducted from SMP/SAP so, at this point, you may be required to take a break from receiving childcare vouchers until you return to work. (As long as you resume your childcare voucher claim within 12 months, it will not be considered a new claim).
Option 3- You can remain in the childcare voucher scheme during the qualifying period, and your maternity leave until you are no longer receiving contractual or occupational maternity pay. Your SMP will then be calculated at the lower rate (after your salary sacrifice deductions).
Statutory Paternity Pay is not affected. Before making your decision, you should seek advice from any relevant agencies in relation to Tax Credit Implications or ongoing childcare costs.
Please consult your HR department for further guidance.
Taking childcare vouchers may have an effect on Tax Credits. Because every family’s situation is different, we can’t comment on your individual circumstances, but HM Revenue Customs have a Tax Credits helpline on 0345 300 3900 which may help you decide what is best for your family. They also have an online tool to help you decide whether you’ll be better off with childcare vouchers. www.gov.uk/childcare-vouchers-better-off-calculator for HMRC’s ‘Childcare vouchers and tax credits better off calculator’.
Most employers are happy to accept childcare vouchers as pay when calculating overtime, so your payments should not be affected by taking childcare vouchers. Check with your employer.
Sodexo is a proud member of the CVPA (Childcare Voucher Providers Association). The industry association was established to protect all stakeholders’ (employers, parents and childcare providers) interests by ensuring best practice by its members through security of voucher funds, integrity of data management and service levels.
Your employer has to put the childcare voucher service in place before you can join it. If your employer doesn’t have a scheme in place, why not let them know about the childcare voucher service from Sodexo? Once your employer has joined the service, they will invite you to join and our online tools will guide you through the process:
- Step 1. You create an individual account
- Step 2. You add the details of your childcare provider(s) to your account
- Step 3. Your employer orders vouchers for you
- Step 4. The vouchers show up as credit in your individual account
- Step 5. You can pay your childcare provider(s) directly from your online account.
Once you have registered with us, you will be sent a confirmation email. You can access your e-voucher account at any time using your username and password.
The scheme is usually open for applications all year round, however, your employer will decide on the joining dates; please check with them for more information. Once your application has been approved, your employer will order your vouchers for you on the next available payroll period. The vouchers will then show as a credit in your childcare account for you to spend with your childcare provider.
Your childcare provider has to demonstrate they are registered if you want to pay them using childcare vouchers. If your childcare provider is regulated by a national body such as Ofsted they should have a registration number and a certificate.
E-vouchers work in a similar way to online banking. You are given a personal e-voucher account that you access to arrange payment directly into your childcare provider’s bank account. You can easily monitor your payments and make them when it suits you or set up a regular payment for a set amount, which goes directly into your childcare provider’s bank account on a set day every month.
If you temporarily lose access to the internet, you can manage your account by calling our friendly customer care team on 0800 328 7411.
In the first instance, please contact our Customer Carer team to assist, as follows:Email: firstname.lastname@example.org
Phone: 0800 328 7411
Complaints will be handled initially within 3 business days of receipts.
If the complaint is not resolved within the timeframe, it will be escalated to the team leader, who will in turn escalate to the Compliance Manger if they are unable to resolve it.
Upon resolving a CCV Complaint a final resolution letter/e-mail will be sent to the complainant, explaining how the complaint has been resolved.
If a CCV complaint is not upheld or a complainant challenges the final response, the existence of the CVPA will be made clear, and that complaints can be made to the CVPA if a complainant believes that Sodexo has failed to comply with the CVPA Code of Practice. In such a situation, full details of the CVPA must be provided.