Just because you are have childcare costs it doesn’t follow that you are entitled to help with it.

You're entitled if you are one of the following:

• A single parent (and work 16+ hours a week)
• A couple and you both work 16+ hours per week
• A couple, one of you works 16+ hours per week, and the other
• Is classed as a carer of a disabled person by the Jobcentre Plus
• Is unfit for work. This applies if you have been getting contribution based Employment and Support Allowance (or national insurance credits because of incapacity for work) for at least 28 weeks (if you’ve been getting Statutory Sick Pay before this it counts towards the 28 weeks), or Disability Living Allowance, or Personal Independence Payment, or Attendance Allowance, or Incapacity Benefit, or Severe Disablement Allowance, or get the constant Attendance allowance part of Industrial Injuries Disablement Benefit, or get Housing Benefit that includes the disability premium or the higher pensioner premium.
• Is in prison

Even then, you can’t get help unless the childcare is ‘relevant childcare’, which basically means that the person has to be approved by the government to do this work. If you’re not sure if this applies to you seek further advice.

Even then, you can’t get help if the children you are getting childcare for are too old: if you’ve got to the first 1st September after the child’s 15th birthday they are too old, unless they are classes as disabled, in which case it is the first 1st September after the child’s 16th birthday.

If you get Childcare Vouchers from your employer you cannot use them for your childcare element. You may need to seek advice, as deciding between the two can be tricky

How to work out the amount of your childcare element

I've taken some shortcuts here to make things easier to understand. If you use this approach you answer may not be exactly correct, but it will give you a good idea of what to expect.

(Note: the government has not increased these rate for the year 2016-16)

• Work out the average weekly amount of your childcare costs
• Divide this by 7 and multiply it by 365 to give a yearly amount
• If you have one child and your yearly amount is more than £9,125 you have to 'pretend' that your yearly amount is only £9,125
• If you have more than one child and your yearly amount is more than £15,643, you have to 'pretend' that your yearly amount is only £15,643
• Take your yearly amount (or pretend yearly amount) and multiply it by 70% (multiply by 70 and divide by 100) to get your childcare element figure

Let’s look at Toni again. She has to pay an average of £340 per week for the childcare for her three children. The yearly amount would be about £17,729 (340 divided by 7 and multiplying by 365) Because this is more than £15,643, Toni has to pretend the £17,729 is £15,643 Her childcare element is therefore about £10,950 (70% of £15,643)

Remember that, like everything else to do with tax credits, your initial award is based on the estimate that you give them, but your final award is based on what the childcare actually costs you, so you could end up with an overpayment if you overestimate your childcare costs. Legally you are obliged to tell them within a month if your childcare costs go down by more than £10 per week or stops altogether. See my page on tax credit overpayments here for more information

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