Employers can give an employee childcare vouchers or pay for childcare directly up to £55 a week – and no tax!  Actually the monthly limit is slightly more as it is £243.

So instead of a pay rise, ask your employer to do this and you could save the tax and National Insurance and your employer can save his National Insurance too.  Of course if you own a company of which you are an employee you can save money both ends.

Remember that BOTH parents can claim help with childcare costs.  A basic rate taxpayer can save up to £962 and a higher rate tax payer up to £1,196 so get prodding your other half to approach their employer too!

Careful if you get a lot of tax credits though, as you may not be as well off as you think.

30th October 2007