Childcare vouchers have been vital for many working parents, saving money and helping them juggle working and caring for their children.  Iain McMath, managing director of Sodexo Motivation Solutions  tells us what to expect in the next financial year.

The government has announced projected changes in April 2011 which will mean a reduction in the tax relief that some parents are currently receiving with childcare vouchers.

At the moment, if you earn more than £44,000, you can receive a greater tax saving on your childcare benefits than those who are paid at the basic rate.  However from April next year, the amount of tax savings available from childcare vouchers will be the same for everyone.  This will be set at the current basic rate. 

Lower tax relief from April 2011

The changes will mean that anyone who joins an employer-supported childcare scheme from 6th April 2011 will receive a lower level of income tax exemption than they do now if they are a higher or additional rate tax payer.

Failing to sign up for childcare vouchers before April 2011 will mean that many new parents will lose out over a potential 16-year span, which amounts to a substantial loss. 

An interesting piece of recent research conducted by Tesco magazine has estimated the true value of a mum’s worth – and it’s a staggering £1,425,104 per child from birth to 18 years.  In the course of one child’s life, a mother will spend more than 88,000 hours childminding, equating to more than £600,000. The average wage for a registered childminder is £3.54 per hour during the day, which can leap to £10 per hour for afterschool care. This works out as an average of £6.77 per hour

This not only puts into perspective the amount of time and money parents spend getting their children to maturity, but also the attractiveness of  employers who support their hard working  mothers and fathers.

Childcare vouchers can be used for more than nursery fees

Childcare vouchers won’t be able to pay for this, but can help towards the cost of raising your child. Many parents don’t realise that childcare vouchers can be used for children up to the age of 16 on a wide range of activities, not just for nurseries.

Childcare vouchers can also be used for afterschool activities, summer camps and even boarding school.

And working dads can save money by using childcare vouchers, too – there really is no reason not to sign up.