childcare vouchers

Posted by Anonymous PM | on Tue, 09/02/2010 - 14:34 296 4 comments | report

Have a new client that is trading as a one woman limited company. Director/shareholder will be going on maternity leave in the summer (already has a child in registered childcare). Looking at setting up childcare vouchers to be administered in-house. Because of impending maternity leave, there will be a slowdown in income therefore might not be in a position to maintain £55 per week - can this amount be varied (or even stop for a period of time?).

I assume there is nothing to prevent this other than admin and ensuring £55 per week not exceeded (for p11d purposes).

Can anyone confirm?

thanks

Comments

Salary Sacrifice?

neileg | Tue, 09/02/2010 - 17:13 | Permalink

If you're doing this under salary sacrifice then the short answer is no. If you keep mucking about with the level of sacrifice you will breach the rules.

Why bother with vouchers?

Euan MacLennan | Tue, 09/02/2010 - 17:18 | Permalink

Just arrange for the registered childminder to invoice the company for the specified amount each month with the balance charged to the mother.

As she "already has a child in registered childcare", I assume that she is not already claiming the tax-free benefit for that child because it is a limit of £55 a week per parent regardless of the number of children. However, if there is a father, he could also claim the tax-free benefit if his employer is prepared to pay it, probably in exchange for a salary sacrifice.

direct with childcare provider

Anonymous | Tue, 09/02/2010 - 18:43 | Permalink

Is it possible to contract direct with childcare provider for a part invoice? I know in essence there would be two invoices (one for company, one for parent) is this acceptable to HMRC? I wouldn't want to be caught out with potential BIK for the excess. Is this likely?

PS - no vouchers claimed in the past, previously a sole trader and encouraged to incorporate by previous adviser. Only a small business so trying to eek out the best of being incorporated...

thanks

Childcare

Anonymous | Wed, 10/02/2010 - 11:16 | Permalink

I incorporated my little business with the main aim to benefit from the childcare voucher scheme. My childcare invoices my business £243 per month, the remander is invoiced to me personally. The tax advantage to me is very slim as needs to be offset with the cost of producing statutory accounts as a limited company, but still worth doing. Also, I'm not sure if the scheme as it currently stands will still be around in a few years time.