As of April 2003 The Working Families Tax Credit has been replaced by 2 new credits - Child Tax Credit and Working Tax Credit. If you are eligible, Working Tax Credit could help you with your childcare costs.

What is the help called?
Childcare element of the Working Tax Credit

Who is it for?
Families who pay childcare costs to a registered childcare provider where either the lone parent or both parents work for at least 16 hours a week, or where one partner works and the other is disabled.

What do you get?
From April 2007 up to 80% of eligible childcare costing up to £175 (i.e. £140) a week for one child or £300 (i.e. £240) for two or more. Your childcare element is then added to the amount of Working Tax Credit for which you qualify. The final amount you get will depend on your income.

What is the main difference with the old system?
Parents just have to fill in the childcare providers details and amount of childcare costs on the application form - you don't have to rely on anyone to sign for you.

The money is paid in to the main carer's bank account, rather than through the wage slip

Parents can access payments for childcare which takes place in their own home, as long as it is registered care and the carer is not the claimants partner or a relative of the child.

You must have a bank account to receive payments

6 month fixed rate system has been abolished - you just advise the Inland Revenue when your circumstances change. Typically this will be if your income changes, you or your partner has a baby, or your child care costs change. For childcare, this will be if your average charges go up by £10 per week or more for at least 4 weeks in a row - or if your child care charges fall or if you stop paying childcare altogether. You can do this by telephoning the Tax Credit Helpline, by post, internet or even face to face at an Inland Revenue Enquiry Centre. Your award will then be adjusted accordingly. Please remember to keep in touch with Hackney Council as well, so any other benefits will be adjusted in line with your change in circumstances.

What about my Housing Benefit?
Housing benefit payments are disregarded when assessing the amount to be awarded for the childcare element of the Working Tax Credit.

Please note however, that your Housing Benefit will be affected by your Working Tax Credit award. So make sure you stay in touch with Hackney Council, as they will wish to make adjustments if any element of your Working Tax Credit or Childcare circumstances change.

If you don't let them know of your changed circumstances, you may have to pay back any over payments made to you.

I think that I earn too much to be eligible...
You might be surprised how much a difference it could make. Take this example: If both parents were working, and earning a combined income of £30,000, with two children and paying £200 a week for registered childcare, they may still be eligible for up to £5,180 a year in tax credits. However, if they had no childcare costs, this would go down to £545. In many cases it is worthwhile you making that phone call to the Helpline.

What is the age limit for my children?
16 or under for children with a disability, otherwise, 15 or under

What kind of care is eligible?
Care must be registered or approved by an accredited organisation. If you have any doubts, just call the Helpline and they will give you further guidance. It is worth remembering that all paid for childcare out of the home for children under 8 is already required by law to be registered with OfSTED.
Examples of eligible care include:

• Childminders
• Day Nurseries
• Pre-schools or Playgroups
• After-School clubs
• Holiday clubs
• Accredited holiday schemes for children aged 8 and over
• Home childcarers (excluding relatives) (Ask CIS for further details about this)
• Care provided by domiciliary workers or a nurse from a registered agency.

What are some examples of care that is not eligible?
Care provided by a relative in your own home, even if registered as a childminder or childcarer Care provided by someone in your own home who is not a registered as a 'home child carer' or a domiciliary care worker or a nurse employed through a registered care agency

A holiday scheme for children aged 8 and over which is not accredited with any organisation

I use more than one registered childcare provider?can I claim for both?
Yes - all you do is complete the details for the second provider on the form.
Should you require space for additional carers, use the space provided at the back of the Notes from the Claim Form.

I don't have a bank account so how will I receive the money?
You will need to open one in order to receive payments. Any bank or building society should help you open an appropriate account. You may even find that a special account sometimes called a 'Basic', 'Starter' or 'Introductory' Account will suit you best.

The Post Office plans to open a new account called a 'card' account that can be used for benefits and tax credits. Please note that the Tax Credit Helpline need to send you an ?invitation letter' for you to take to your local Post Office before you can open such an account.

If you are unable to open a bank account and until the Post Office accounts are up and running, you will be able to receive the tax credits as a giro.

Helplines: Tel: 0845 300 3900 8.00 a.m. - 8.00 p.m.

For people with hearing or speech difficulties 0845 300 3909

Claims online
http://www.hmrc.gov.uk/menus/credits.htm

Tax Credit Helpline ...0845 300 3900