MILLIONS of working households could claim up to 85% off their childcare costs by doing a quick check.
Parents struggling to afford childcare as the cost of living crisis continues to bite could be missing out thousands in childcare support.
Working parents on Universal Credit can claim up to 85% of childcare costs every month worth £648 for one child and up to £1,108 for two children.
To be eligible you (and your partner if you live with them) will usually need to either:
- be working – it does not matter how many hours you or your partner work
- have a job offer
However, people often assume they won't be entitled to any support because they are in employment.
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This assumption is almost always wrong, and even those on salaries in excess of £30,000 a year can bag free cash for childcare.
One individual recently posted in a Facebook saying: "I would highly suggest anyone on a mid range wage who thinks they woudn't be entitled to Universal Credit to give citizens advice a call or do an online benefits calculator."
The post went on to say: "Me and my partner both earn £30,000 a year each – so £60,000 a year in total."
They said they thought they would never be entitled to any childcare help for their one year old and four year old child.
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However, the individual went on to say: "However, with a £1,300 childcare bill, Universal Credit gives us £700 a month after deducting our earning."
You would need to have less than £16,000 in savings and be eligible for Universal Credit to apply.
What is Universal Credit?
Universal Credit is a welfare scheme which is supposed to combine a number of old "legacy benefits" into a single monthly payment.
The old legacy benefits it replaced are:
- Child Tax Credit
- Housing Benefit
- Income Support
- Income-based Jobseeker’s Allowance (JSA)
- Income-related Employment and Support Allowance (ESA)
- Working Tax Credit
Universal Credit payments are made up of a standard allowance and then various additional payments that depend on your circumstances.
This is how much you will get as your standard allowance each month:
- Single, under 25 – £265.31
- Single, 25 or over – £334.91
- Couple, joint claimants both under 25 – £416.45 (for both of you)
- Couple, joint claimants, one or both 25 or over – £525.72 (for both of you)
You may get additional payments, for instance if you:
- have children
- have a disability or health condition which prevents you from working
- need help paying your rent
You can use a benefits calculator to see how much you're likely to get in total.
You are assessed every month and if things change, it might affect how much you are paid for the whole assessment period.
If you start earning more from work, you'll get a reduction in payments due to something called the taper rate.
As your income increases, your payment will reduce until you’re earning enough to no longer claim Universal Credit – then your payments will be stopped.
Who is eligible for Universal Credit?
Whether you are eligible will depend on your specific circumstances.
You may be eligible if you meet some of the following criteria:
- you’re on a low income or out of work
- you’re 18 or over (there are some exceptions if you’re 16 to 17)
- you’re under State Pension age (or your partner is)
- you and your partner have £16,000 or less in savings between you
- you live in the UK
Your partner’s income and savings will be taken into account, even if they are not eligible for Universal Credit.
There are other factors that might make you eligible for a claim, for instance if you care for a disabled person, you're in further education or if you've recently had a child.
You can read the full eligibility criteria on the government's website.
How to apply for Universal Credit
To apply for Universal Credit you'll need to go online and create an account, then there are further steps to take.
Once you've created an account you must make a claim within 28 days otherwise you'll have to start again.
If you live with your partner, you'll both have to create accounts and you'll join them together when you claim.
If you're struggling to claim online you can use the Universal Credit helpline which is 0800 328 5644.
To apply online you'll need your bank, building society or credit union account details.
On top of this, you'll need an email address and access to a phone.
If you don't have these things, you can call the Universal Credit helpline or go to a job centre.
To find you nearest job centre, you can use its website.
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After you've offered your bank details, you will have to provide your driving licence, passport, debit or credit card, payslip and P60.
In addition, you'll need to prove how much rent you pay, your earnings, any disability or health condition that affects your work, how much you pay for childcare and your savings and any investments, such as shares or a property you rent out.
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