Hi all

The client will be paying an OFSTED registered childcare provider who provides care in the child's own home. The childcare provider is therefore an employee of the client and it is the client who has to pay the provider's tax and NICs on earnings. Any thoughts on whether in this case, can the amount claimed from the childcare element of WTC be the gross pay to the childcare provider, ie can it include the tax and NICs?

Many thanks

Josh

IMO, gross pay is the employee's; the employees NICS and tax are paid by the employee out of gross pay.

think about you own pay ....

it's admin etc that results in employer deducting NICS and tax at source.

therefore, it is the gross pay that should be claimed for the purpose.

Just wondering whether the child care element can be claimed for an employee unless they are "a domiciliary worker or nurse from an agency ‘registered’ under the Domiciliary Care Agencies Regulations 2002 providing childcare in the child’s home". Ref Tax Credits Technical Manual para 02630.

Does the employment status of the chidlcare provider make a difference? The regulations, TCM 02630 and WTC5 "Help with the costs of Childcare" seem clear that childcare providers in the child's own home, ie nannies, can be claimed for as long as they are registered with OFSTED on the appropriate register. As far as I understand nannies are normally employees and there does not seem to be anything in the regulations or technical manual that suggests that the fact that they are employed by the claimant, rather than paid on a self-employed basis as a childminder would be, affects whether you can claim for them.

Is this wrong though?

Thanks

Josh

Section 02630 of the Tax Credits Technical Manual specifies the child care provider for whom costs can be inccluded in the Child care element

The childcare must be provided by one of the following:
(1) a childcare provider ‘approved’ under a Ministry of Defence accreditation scheme abroad

(2) an ‘approved’ foster carer. (The care must be for a child who is not a foster carer’s foster child or provided by a person who is the child’s kinship carer). For England only, from 18 July 2009 the foster carer must be registered by Ofsted, either in the Early Years Register or in the compulsory or voluntary part of the General Childcare Register.

plus in England:
(3) a childcare provider ‘registered’ by Ofsted, either in the Early Years Register or in the compulsory or voluntary part of the General Childcare Register

(4) childcare provided to a child between 3 and 4 years by a school under the direction of the school’s governing body or an equivalent body, on school premises or premises that may be inspected as part of an inspection of the school by the Chief Inspector

(5) out-of-school hours childcare or supervised activity based childcare, provided for a child aged between 5 and 15 years (or 16 if disabled) by a school on the school premises, or premises that may be inspected as part of an inspection of the school by the Chief Inspector or by a childcare provider ‘registered’ by Ofsted

(6) a person ‘approved’ under the Childcare Approval Scheme providing childcare in the child’s home or in other domestic premises. Note - the childcare Approval Scheme in England stopped taking new applications from 1 October 2007 and applicants were directed to apply to the Ofsted Childcare Register for registration. Those already approved under the Childcare Approval Scheme remain approved until their approval expires (maximum 1 year after it was granted). From the 18 July 2009 we cannot accept anyone approved by ‘the Childcare Approval Scheme’ as stated above, they must now register with Ofsted.

(7) a domiciliary worker or nurse from an agency ‘registered’ under the Domiciliary Care Agencies Regulations 2002 providing childcare in the child’s home.

I wonder if a child care provider referred to in (3) could be an employee who was not available to look after children on people other than the employer (ie a nanny), or whether they would have to be self employed or a business and therefore take other children at the same time or in a general sense. (6) is no longer relevant, which would leave (7) which I assume is meant to cover nannies which therefore have to be provided through an agency.