UK parents can claim government top-ups on nursery and holiday club fees
Key Points
- Tax-Free Childcare pays a £2 government top-up for every £8 parents deposit, worth up to £2,000 a year per child.
- Families using the scheme save an average of almost £100 a month, according to HMRC figures for March 2026.
- Accounts cover children aged 11 or under, or 16 or under for a disabled child, who qualifies for up to £4,000 a year.
- Almost 75,000 providers accept the payments, including nurseries, childminders and holiday clubs.
- Parents earning over £100,000, or claiming Universal Credit or childcare vouchers, do not qualify.
HM Revenue and Customs (HMRC) is urging working parents to sign up for Tax-Free Childcare, which pays up to £2,000 a year per child towards nurseries, childminders and holiday clubs.
The department timed the reminder to Playday on 5 August, the national day for play. The scheme adds a £2 government top-up for every £8 a parent pays into a Tax-Free Childcare account.
Families can claim up to £500 every three months per child, rising to £1,000 for a disabled child, and can open an account for each child aged 11 or under.
HMRC’s latest figures, covering March 2026, show families using the scheme saved an average of almost £100 a month.
Almost 75,000 childcare providers now accept the payments, including nurseries, childminders, breakfast clubs, after-school clubs and holiday clubs. Parents can spend the money as soon as they deposit it or leave it in the account for later, and they can withdraw unused funds at any time.
Most families on the scheme have younger children, but the number using it for children aged 8 and above rose by more than 20% on the previous year.
“If you haven’t signed up already, do it today so you don’t miss out,” said Myrtle Lloyd, HMRC’s Chief Customer Officer.
Who qualifies?
Eligibility ends on 1 September after a child’s 11th birthday. Where a child has a disability, the account runs until 1 September after their 16th birthday and pays up to £4,000 a year. Parents also need to meet three further conditions:
- The parent, and their partner if they have one, earns at least the National Minimum Wage or National Living Wage for 16 hours a week on average
- Each earns no more than £100,000 a year
- Neither receives Universal Credit or childcare vouchers
Parents can use Tax-Free Childcare alongside the government’s funded childcare hours, subject to eligibility. HMRC has set out how the offers combine on the Best Start in Life parent hub, and applications go through GOV.UK.
