UK Tax-Free Childcare Calculator 2026/27

Tax-Free Childcare top-up calculator 2026/27: £2 for every £8 you pay in, up to £2,000 a child a year (£4,000 if disabled), £100,000 income limit.

Benefits & Credits

Work out the HMRC Tax-Free Childcare top-up. For every £8 you pay into your childcare account, the government adds £2 - up to £2,000 a year per child (£4,000 for a disabled child). Each parent must usually be in work and expect to earn at least £2,643.68 over the next 3 months if 21 or over (16 hours a week at the National Living Wage), and neither can expect adjusted net income over £100,000 for the tax year. This calculator checks the income limit and the minimum earnings test (at the 21-and-over rate, on the yearly average of the income you enter), and caps the top-up per child, splitting the cost evenly when you have more than one. It is general guidance based on the published HMRC scheme - not financial advice. Check eligibility on gov.uk: Tax-Free Childcare eligibility before relying on a figure.

Worked scenarios for 2026/27

1 child, £5,000 nursery cost, both parents working

£1,000/yr top-up

Net cost £4,000 (you deposit £333/mo)
1 child, £10,000 full-time nursery (cap reached)

£2,000/yr top-up

Net cost £8,000 (you deposit £667/mo)
2 children, £15,000 combined nursery + after-school

£3,000/yr top-up

Net cost £12,000 (you deposit £1,000/mo)
Single parent on £45k, 1 child, £8,000 cost

£1,600/yr top-up

Net cost £6,400 (you deposit £533/mo)
1 disabled child, £18,000 specialist nursery

£3,600/yr top-up

Net cost £14,400 (you deposit £1,200/mo)
One parent earns £105k (ineligible)

Not eligible

A parent expects adjusted net income over £100,000 for the tax year

What Tax-Free Childcare is

Tax-Free Childcare (TFC) is a UK government scheme run by HMRC that helps working parents pay for approved childcare. For every £8 a parent pays into an online childcare account, the government adds £2, so the government covers 20% of the bill. The top-up is not delivered through the tax system.

You pay nurseries, childminders, nannies, after-school clubs and holiday clubs directly from the account. Used in full, the scheme is worth up to £2,000 a year per child, or £4,000 for a disabled child.

This page provides general guidance only. It is not financial advice and is not a substitute for the official eligibility check on gov.uk/tax-free-childcare. You must confirm your details every 3 months, so always check before relying on a number.

How the 20% top-up works in practice

Apply on gov.uk/tax-free-childcare. You get a separate childcare account for each eligible child. Check first that your provider is signed up to the scheme.
Pay money in by Direct Debit, standing order or bank transfer. The payment usually appears within one working day and the government’s top-up is added at the same time, so £80 of your money becomes £100 in the account.
Pay your childcare provider directly from the account.
Sign in every 3 months to confirm your details are up to date. If you do not, your Tax-Free Childcare stops.

The yearly cap is made up of a £500 limit per child for every 3 months (£1,000 for a disabled child). If your childcare bill is heavily weighted to school holidays, spreading payments into the account across the year captures more of the yearly maximum than paying in one large sum.

Eligibility - the basic rules

Per gov.uk: check if you’re eligible:

Child’s age: eligible until the September after they turn 11, or the September after they turn 16 if disabled. The child must usually live with you; foster children are not covered.
Work: you, and your partner if you have one, must usually be in work (employed or self-employed), including on sick, annual, maternity, paternity, shared parental or adoption leave. A non-working partner may still qualify you if they get certain benefits, such as Carer’s Allowance or contribution-based ESA.
Minimum earnings: each of you must expect to earn at least £2,643.68 over the next 3 months if aged 21 or over, £2,256.80 if 18 to 20, or £1,664.00 if under 18 or an apprentice: 16 hours a week at the 2026/27 minimum wage. If you started a business less than 12 months ago there is no minimum. Dividends, interest, property and pension income do not count towards it.
Income limit: neither of you can expect adjusted net income over £100,000 for the tax year.
Status: you need a National Insurance number and British or Irish citizenship, settled or pre-settled status, or permission to access public funds.
Other support: you cannot get Tax-Free Childcare while claiming Universal Credit or childcare vouchers, or if you get a childcare bursary or grant.

Adjusted net income has the meaning in Income Tax Act 2007 s.58, applied to Tax-Free Childcare by regulation 15(4) of the Childcare Payments (Eligibility) Regulations 2015. It is total taxable income less grossed-up Gift Aid donations and gross personal pension contributions paid under relief at source, and it includes foreign income. Salary sacrifice reduces it too, because it lowers your taxable pay. If your salary is £105,000 and you sacrifice £8,000 into your workplace pension, your adjusted net income is £97,000, inside the limit.

Tax-Free Childcare vs Universal Credit

You cannot claim both at the same time. Universal Credit can pay back up to 85% of childcare costs, capped in 2026/27 at £1,071.09 a month for one child and £1,836.16 for two or more (gov.uk), but only if you qualify for Universal Credit.

Feature	Tax-Free Childcare	UC childcare costs
Subsidy rate	20% of the bill	Up to 85% of costs
Cap	£2,000 a year per child (£4,000 disabled)	£1,071.09 a month for 1 child, £1,836.16 for 2+
Income test	£100,000 adjusted net income each partner	The Universal Credit means test
Confirming details	Every 3 months	Report changes as they happen

As a rough guide, if your household qualifies for Universal Credit and childcare costs are high, the UC childcare element usually pays more; if you earn too much for Universal Credit but are under £100,000 each, Tax-Free Childcare is the scheme for you. If you already get Universal Credit, gov.uk says to wait for a decision on your Tax-Free Childcare application before cancelling it. The gov.uk childcare calculator compares the two with your figures.

Tax-Free Childcare vs childcare vouchers

Childcare vouchers are the employer scheme that Tax-Free Childcare replaced. You can only keep getting them if you joined and your wages were adjusted on or before 4 October 2018, and you do not take an unpaid career break of more than a year (gov.uk). Up to £55 a week is free of Income Tax and National Insurance. For people who joined from 6 April 2011, the weekly limit is £28 for higher-rate and £25 for additional-rate taxpayers (HMRC EIM16053).

Vouchers are a fixed amount per parent; Tax-Free Childcare scales with your actual childcare costs up to £2,000 per child, but has the £100,000 limit. Once you tell your employer you are getting Tax-Free Childcare (you must do so within 90 days of applying) you cannot rejoin their voucher scheme, so compare the two with the gov.uk childcare calculator before you switch.

Interaction with free childcare hours

Tax-Free Childcare can be used alongside the free hours schemes. In England (gov.uk):

15 hours a week for all 3 and 4 year olds, for 38 weeks of the year.
Up to 30 hours a week under Free Childcare for Working Parents, for children aged 9 months to 4 years where you (and your partner) work and meet the earnings tests.

The free hours are funded directly to the provider. Tax-Free Childcare then pays for extra hours and extras the provider supplies, such as meals, nappies and trips. In England you apply through the same childcare account, which checks both schemes, and confirm your details every 3 months. Scotland, Wales and Northern Ireland run different free childcare schemes.

An employer-provided workplace nursery is a separate tax exemption (ITEPA 2003 s.318).

Disabled child uplift

A child counts as disabled for Tax-Free Childcare if they are certified as blind or severely sight impaired, or get Disability Living Allowance, Personal Independence Payment, Armed Forces Independence Payment, or (in Scotland) Child Disability Payment or Adult Disability Payment. Then:

The yearly top-up cap doubles from £2,000 to £4,000 per child.
The childcare spend needed for the full top-up doubles from £10,000 to £20,000: £16,000 of your money plus £4,000 from the government.
Eligibility runs until the September after they turn 16.

You can also use the extra money to help your provider get specialist equipment for your child, such as mobility aids. The calculator on this page lets you flag disabled children and applies the higher cap.

When to seek advice

Tax-Free Childcare interacts with Universal Credit, the £100,000 adjusted net income test, the free hours schemes, childcare vouchers and workplace nurseries. None of those interactions are modelled by the simple calculator above. For help:

Citizens Advice - free, independent advice.
HMRC Childcare Service helpline - 0300 123 4097, for problems with your childcare account.
Your employer’s payroll or benefits team - particularly if you currently get childcare vouchers or are considering salary sacrifice to manage your adjusted net income.

See our methodology for how the site’s calculators work.

Universal Credit Calculator - model Universal Credit as an alternative.
Salary Calculator - work out the net pay that feeds the household income picture.
Tax Trap Calculator - see how the £100,000 Personal Allowance taper lines up with the Tax-Free Childcare limit.
Salary Sacrifice Calculator - use pension sacrifice to reduce adjusted net income below £100,000.
Maternity Pay Calculator - work out Statutory Maternity Pay (SMP) before childcare costs begin.

Other UK tax calculators that pair with the Tax-Free Childcare.

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Frequently asked questions

Who can claim Tax-Free Childcare?

Working parents, single or in a couple, where each parent expects to earn at least £2,643.68 over the next 3 months if aged 21 or over (16 hours a week at the National Living Wage; lower amounts apply under 21) and neither expects adjusted net income over £100,000 for the tax year. The child must usually live with you and is eligible until the September after they turn 11, or 16 if disabled. You need a National Insurance number and a qualifying immigration status. You cannot get Tax-Free Childcare while claiming Universal Credit or childcare vouchers.

How does the 20% top-up actually work?

You open a childcare account for each child. For every £8 you pay in, the government adds £2, so it covers 20% of the bill. The top-up is capped at £500 every 3 months per child (£2,000 a year), or £1,000 every 3 months (£4,000 a year) for a disabled child. To get the full £2,000 you need £10,000 of childcare in the year: £8,000 from you plus £2,000 of top-up. You pay your provider directly from the account.

What counts as eligible childcare?

The provider must be approved childcare and signed up to the scheme: a registered childminder, nanny, playscheme, nursery or club, a childminder or nanny with a registered childminder agency or childcare agency, a registered school, or a home care worker with a registered home care agency. That covers nurseries, childminders, nannies, breakfast, after-school and holiday clubs, and extras such as meals, nappies and trips supplied by the provider.

Can I use Tax-Free Childcare alongside 30 hours free childcare?

Yes. In England, Free Childcare for Working Parents gives up to 30 hours a week for children aged 9 months to 4 years, and all 3 and 4 year olds can get 15 hours a week for 38 weeks of the year. The free hours are funded directly to the provider; Tax-Free Childcare can pay for extra hours and extras. You apply for both through the same childcare account and confirm your details every 3 months. Scotland, Wales and Northern Ireland have different schemes.

Is Tax-Free Childcare or Universal Credit better?

It depends on the household, and you cannot claim both at the same time. Universal Credit can pay back up to 85% of childcare costs, capped in 2026/27 at £1,071.09 a month for one child and £1,836.16 for two or more, but only if you qualify for Universal Credit. Tax-Free Childcare pays 20% of costs up to £2,000 a year per child and is open up to the £100,000 limit. If you already get Universal Credit, wait for a decision on your Tax-Free Childcare application before cancelling it. The gov.uk childcare calculator compares the two.

What about Childcare Vouchers - can I still use those?

Only if you joined an employer scheme and your wages were adjusted on or before 4 October 2018, and you do not take an unpaid career break of more than a year. Up to £55 a week is free of Income Tax and National Insurance; for people who joined from 6 April 2011 the limit is £28 a week for higher-rate and £25 for additional-rate taxpayers (HMRC EIM16053). You cannot get new vouchers and Tax-Free Childcare together: you must tell your employer within 90 days of applying, and you then cannot rejoin the voucher scheme.

What if my income changes during the year?

The £100,000 test uses your expected adjusted net income for the whole tax year, and the minimum earnings test uses what you expect to earn over the next 3 months. You must sign in every 3 months to confirm your details are up to date; if you no longer qualify, or you do not reconfirm, the top-ups stop. Adjusted net income is the measure also used for the Personal Allowance taper, so pension contributions, including by salary sacrifice, can bring it back under £100,000.

What is the quarterly cap and why does it matter?

The £2,000 (£4,000) yearly top-up is made up of a £500 (£1,000) limit for each 3-month period. Paying a large sum into the account in one period only attracts that period's £500 of top-up, so if your childcare costs are lumpy (for example summer holiday clubs), spreading your payments across the year captures more of the yearly maximum. This calculator works at the annual level; the 3-month limit is what applies in practice.