Tax credits for nannies and child care for the over-sevens

Families will be able to claim tax credits for a wider range of
child care options, under government proposals.

Under the plans, households with an income of up to £43,000
will be able to claim tax credits for care provided in the family
home, including that offered by nannies, as well as breakfast
clubs, holiday clubs, and childminders for children over the age of
seven.

Currently, parents have to use registered child care such as
nurseries and childminders for under sevens in order to qualify for
tax benefits.

In addition, a new service is to be set up to approve carers
that meet certain standards. Parents will have to use approved
carers in order to qualify for the financial support. Care provided
in the parental home by a relation of the child will not be
eligible for tax credits.

The consultation will run until 16 August and the scheme is
expected to be operating by April 2005.

The Daycare Trust gave a qualified welcome to the proposals, but
said they didn’t go far enough. Director Stephen Burke said:
“Light touch accreditation is a step in the right direction but it
is primarily designed to enable parents to get tax credits and tax
breaks. Why isn’t the current regulatory system simply
extended to cover all forms of child care?”

The National Childminders Association also expressed
reservations, though it welcomed the move to enable parents to get
help with the costs of child care for children over aged seven.
“This scheme must be developed in a way that ensures parents are
not left confused about the difference between registered and
approved carers”, said NCMA chief executive Gill Haynes.

Charity 4Children said that the regulations would provide “much
needed peace of mind” for parents. “This scheme has the potential
to offer flexible choices, with peace of mind for those who need
it,” said chief executive Anne Longfield.