Tax-Free Childcare and 30 free hours - Umbrella

[Coz]

Currently in receipt of Tax-Free childcare and 30 free hours as my divs and salary has been under 100k for ltd company.

Due to start a new contract using an umbrella company in a few weeks. Annual umbrella PAYE salary would be over 100k (even with generous pension contributions) so would lose this benefit. However, new contract is for 6 months only.

My question is would I be able to keep this benefit given there is no guarantee the client will extend the contact?

[ladymuck]

The rules say:

If you or your partner have an expected ‘adjusted net income’ over £100,000 in the current tax year you will not be eligible

The key part is the 'expectation'. If you don't believe you will be extended after six months then you're eligible but will cease to be as soon as you get a sniff of an extension. However if the job was pitched as 'highly likely to extend' then you can't really say that.

[GhostofTarbera]

• You earn less than £100,000 per year.

This applies if you are self-employed or on a zero-hours contract and expect to meet the earning criteria on average over the three months after you have applied for the 30-hours. HMRC will look at data such as your previous earnings to consider whether you are likely to meet the criteria and may contact you for further information if required


so when that £5500 ( Net) hits your bank account each month, you need to pay £1250 ish for child care if London based

also, say goodbye to family allowance that is gone completely also

Your net earning per month has effectively halved

[lucyclarityumbrella]

Currently in receipt of Tax-Free childcare

If this was done via salary sacrifice, then you would need to find an umbrella that operates with your childcare voucher provider, if they don't then you would have to change to go via the government scheme as no new applications to the voucher process are now allowed direct from the employer.