Paying childcare via company

[MarillionFan]

Now that is interesting. Up until 16 for after school or breakfast clubs. Clare. What would be the best combination of salary/divvy to take advantage of this? If a contractor is taking a salary of 8k say and then the rest in divvied is there a benefit?

[escapeUK]

Another child dragged up by strangers

[Clare@InTouch]

Now that is interesting. Up until 16 for after school or breakfast clubs. Clare. What would be the best combination of salary/divvy to take advantage of this? If a contractor is taking a salary of 8k say and then the rest in divvied is there a benefit?

The benefit would be CT relief on up to £55 per week. It doesn't effect your salary/dividend plan. You could take your salary of £7,488, dividends up to the higher rate, plus the childcare on top.

Plus it's per employee. So if your wife does your secretarial work for you and you pay her a small salary, she can claim another £55 too.

Then think about pensions for both employees, and maybe life insurance. Some policies can be put through without incurring any benefit in kind (talk to your IFA).

[Clare@InTouch]

You don't need a voucher scheme either, that just results in unnecessary admin fees. Just make the payments direct from the company, you cannot reclaim on expenses.

[mudskipper]

Believe they can also be used for PGL holidays.

[THEPUMA]

They have to be registered, it can't be a friend or relative. It could be after school clubs or go toward private school fees though.

Hi Clare

When you say private school fees, do you mean peripheral fees for stuff like school trips and after-school clubs or do you mean core school fees? My understanding was that they could be used to pay anything where the primary purpose is to care for your childen but not for school fees where the primary purpose is to educate your children.

So before and after school clubs would be fine as would some school trips (although in the back of my mind there may be something about the premises having to be Ofsted approved, which may not apply to some foreign locations).

Thanks

Puma

[Clare@InTouch]

Hi Clare

When you say private school fees, do you mean peripheral fees for stuff like school trips and after-school clubs or do you mean core school fees? My understanding was that they could be used to pay anything where the primary purpose is to care for your childen but not for school fees where the primary purpose is to educate your children.

So before and after school clubs would be fine as would some school trips (although in the back of my mind there may be something about the premises having to be Ofsted approved, which may not apply to some foreign locations).

Thanks

Puma

Sorry, yes I did. Private schools often charge additional fees for extra services, and the vouchers can be used against those. It's just a question of asking the school for a breakdown, and then checking what the vouchers can be used against.

My typing can't always keep up with my brain!

[FiveTimes]

You don't need a voucher scheme either, that just results in unnecessary admin fees. Just make the payments direct from the company, you cannot reclaim on expenses.

So if I get a bill from childcare then I can just pay that straight from the business account ? I thought you had to register with someone like busybees ?

[insur]

They have to be registered, it can't be a friend or relative. It could be after school clubs or go toward private school fees though.

Private school fees will only be covered for the school term before the child turns five.

[Clare@InTouch]

So if I get a bill from childcare then I can just pay that straight from the business account ? I thought you had to register with someone like busybees ?

Nope, as you run your own company you can just make the payments direct.

HM Revenue & Customs: Childcare