Childcare vouchers UK 2026

By PaySlipCheck Editorial · 14 June 2026 · 5 min read

UK childcare vouchers are a salary sacrifice scheme that closed to new joiners on 4 October 2018. Existing users can continue — up to £243/month tax-free sacrificed from salary. Tax-Free Childcare (introduced 2017, expanded 2018) replaced vouchers for new users — the government adds 25% to your childcare contributions (£2,000/year max top-up per child). This guide covers both schemes + when each is more valuable for your family.

Verified against 4 official sources · Last reviewed 14 June 2026
On this page
  1. Childcare vouchers (legacy scheme)
  2. Tax-Free Childcare (current scheme)
  3. Which is better?
  4. Common mistake: switching
  5. Universal Credit + childcare
  6. In short

Childcare vouchers (legacy scheme)

Available to workers who joined a scheme before October 2018.

Sacrifice limits: - Basic rate: £243/month (£2,916/year) tax-free - Higher rate: £124/month (£1,488/year) tax-free - Additional rate: £110/month (£1,320/year) tax-free

Tax + NI savings on sacrificed amount.

Value at maximum sacrifice: - Basic-rate: £2,916 × 28% = ~£820/year saved - Higher-rate: £1,488 × 42% = ~£625/year saved

Tax-Free Childcare (current scheme)

Government adds 25% to your childcare contributions: - You pay £8, government adds £2 - Up to £2,000/year per child (£4,000 for disabled) - Age limit: 11 (16 for disabled) - Both parents must work

Not a salary sacrifice — you pay from net income; government contributes.

Which is better?

Depends heavily on family circumstances:

Childcare vouchers wins if: - Legacy user with maximum sacrifice + high childcare cost - Two parents both sacrificing - Childcare bill ≤ £6,000/year

Tax-Free Childcare wins if: - Childcare bill £8,000+/year - New to childcare after 2018 - Higher-rate parent (voucher cap is £1,488)

Common mistake: switching

Once you move from vouchers to Tax-Free Childcare you cannot go back. Do the maths carefully.

Universal Credit + childcare

Working parents on Universal Credit can claim 85% of childcare costs via UC. This can be more valuable than either voucher or TFC scheme — but excludes those on both.

In short

Vouchers closed to new joiners Oct 2018. Existing users can continue up to £243/month tax-free. Tax-Free Childcare replaced it with 25% top-up up to £2k/year. Switching from vouchers to TFC is one-way — do the maths.

Frequently asked questions

Can I still get childcare vouchers?

Only if you were in a scheme before 4 October 2018. New joiners can't.

How much tax do I save via vouchers?

Depends on rate — £820/year at basic-rate maximum, £625/year at higher-rate maximum.

Should I switch from vouchers to TFC?

Do the maths first. Once switched, no going back. TFC often better for high childcare costs; vouchers better at lower costs.

Can I use TFC and 30 hours together?

Yes — 30 free hours + TFC top-up on any additional. Free hours must be from an approved provider.

What if I have multiple kids?

TFC applies per child — £2,000/year per child (max £4,000 disabled). Vouchers are per parent.

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Related salary breakdowns

Glossary terms used on this page

Quick definitions for the key terms above.

  • Salary sacrifice — An arrangement where you give up part of your gross salary in exchange for a non-cash benefit (most commonly pension contributions), reducing your Income Tax and National Insurance.

Sources

All figures on this page are sourced from official UK government publications. We don't cite secondary commentary or other calculator sites.

  1. GOV.UK — Employer-provided benefits (Expenses and benefits)
  2. GOV.UK — P11D form
  3. GOV.UK — Income Tax rates
  4. MoneyHelper — Employee benefits

All tax figures on this page use the same configuration that powers our calculators — see our editorial standards for the review process.

Last reviewed: 14 June 2026. Next review due 14 December 2026.

Disclaimer: This page provides general information based on published HMRC and gov.scot figures. It is not personal tax or financial advice. For your specific situation, please consult a qualified accountant or contact HMRC directly.