Parents feeling the pressure from the cost of living crisis could be missing out on financial support
Food, clothes, childcare, days out and sometimes even school costs all add up, so budgeting when you are starting a family or have a family to look after can often be a challenge.
With all the financial challenges that households are currently facing, many parents are unsure of the support that may be available to them, particularly those who are first-time parents.
Our Family Benefits Advice Service can help parents find out what financial support they are entitled to. Here’s a brief summary of what families may be able to claim, depending on their circumstances:
Child Benefit
Parents who earn under £60,000 per year can receive Child Benefit worth up to £21.80 per week if they are responsible for bringing up a child who is under 16 or under 20 if they stay in education.
The amount of Child Benefit a parent receives is dependent on both the number of children and the parent’s income. The full Child Benefit entitlement is:
- £21.80 a week for the first or only child
- £14.45 a week for each subsequent child.
The payment is usually paid every four weeks, but can be paid weekly for single parents or those claiming certain other benefits.
Only one person can receive Child Benefit for their child or children, so couples will have to decide which parent will get it, however if either parent is earning over £50,000 you must pay the ‘High Income Child Benefit Tax charge’ meaning you pay back 10% of your child benefit for every £1,000 of income over £50,000.
If you have income of £60,000 or more you have to repay the full Child Benefit amount or can choose not to receive it at all. However, you should still fill in the claim form as this will help you to get National Insurance Credits which count towards your State Pension, and will ensure your child is registered to get a National Insurance number when they are 16 years old.
Sure Start Maternity Grant
Thousands of new parents on certain benefits can receive a £500 grant to help with immediate financial pressures when caring for a new baby. This one-off payment doesn’t need to be paid back and it won’t reduce your monthly Universal Credit payment or Tax Credits.
Only parents who are expecting their first child are eligible for the grant, so if you’re about to have your second or third baby then you won’t be eligible except in cases of a multiple birth.
Eligible parents can claim the Sure Start Maternity grant from 11 weeks before their baby’s due date up until six months after their child is born.
Universal Credit
Universal Credit is the main ‘means-tested’ benefit for working age adults and includes an element for children and for help with registered childcare costs.
The amount you could get is ‘means-tested’ and depends on how many children you have, when your children were born and what your household income and circumstances are. The maximum paid for a child born before 6 April 2017 is £290 per month. For children born on or after that date the maximum is £244.58 per month, and is restricted to only two children except in cases of a multiple birth.
Eligible working parents may also be able to claim a refund of 85% of registered childcare costs up to £646.35 per month for one child or £1108.04 for two or more children up to the age of 16. You first pay your childcare costs to the childcare provider and then claim the money back through Universal Credit.
Tax Credits
You can only make a new claim for Child Tax Credit if you are already in receipt of Working Tax Credit. If this isn’t the case you may be able to claim Universal Credit instead.
The amount you could get is ‘means-tested’ and so depends on how many children you have, when your children were born and what your household income and circumstances are.
Eligible working parents may be able to get help with up to 70% of registered childcare costs through Working Tax Credits.
Tax-Free Childcare
Working parents could be entitled to up to £2,000 per year of help towards registered childcare costs for each child.
The Government’s Tax-Free Childcare scheme means that eligible parents of children aged 11 and under can get 20% of their registered childcare costs paid, up to a maximum of £500 per child every three months, or £2,000 per year. If your child has a disability, this cap on support is increased to £4,000 per child, per year, until they reach 17 years of age.
Parents need to earn at least the equivalent of 16 hours at the National Living Wage and up to a maximum of £100,000 per year per parent to be eligible for Tax-Free Childcare. We know that many families are not aware that this support is available and are missing out on accessing what they are entitled to through the Tax-Free Childcare scheme.
It’s important to note you cannot get Tax-Free Childcare at the same time as claiming Tax Credits, Universal Credit or Childcare Vouchers.
Healthy Start Card
Eligible parents can claim financial support through the NHS Healthy Start scheme towards the costs of baby milk formula, dairy milk and fresh and frozen fruit and vegetables until a child turns 4.
Families are issued with a prepaid debit card which is automatically topped up each week. The card is accepted as a form of payment in most shops and supermarkets.
Pregnant women will have their card topped up by £4.25 per week, from the 10th week of pregnancy. From the birth of the child, until the child turns 1, this increases to £8.50 per week, per child. Between the age of 1 and 4 the payment reverts back to £4.25 per week for each child.
To be eligible parents must be in receipt of a qualifying benefit or be under 18 and pregnant.
Is there more help I can get?
New parents can be eligible for other non financial support and information. Health visitors and midwives can be a good source of information as to what may be available in your area. This can include, for example, Bounty Packs, free NHS Prescriptions and free NHS Dental Care while you’re pregnant and for 12 months after your baby’s due date.
Further information
For more information on these forms of support, including eligibility rules and how to apply, go to the factsheets section of our website. To make sure your family is claiming all the financial support you are entitled to, contact the Family Benefits Advice Service for a free, personalised ‘better off’ calculation. Freephone 0800 028 3008 or email hello@employersforchildcare.org.
