ParentGuidetoMoney.co.uk

Parents are being urged to sign up for employer-sponsored childcare benefits as soon as possible, after Labour moved to axe the tax-efficient schemes.

As reported in last week’s Money section, the cost to the Exchequer of so-called “salary sacrifice�, which allows parents to pay for childcare out of pre-tax earnings, spiralled to £500m in 2008-9, up from £400m the previous year.

The government proposes to use the funds to provide 10 hours a week free childcare for children aged two to 16 from families on “low and modest incomes�.

Furious mothers flooded internet forums following the decision, which is likely to rob more than 450,000 families of £2,400 in tax relief a year.

What will be scrapped?

Most large employers operate a scheme that allows workers to buy childcare vouchers worth £55 a week — couples get £110 a week, or £5,720 a year — out of pre-tax earnings.

The vouchers can be used to pay for childcare up to the age of 16. The tax savings arise because parents do not pay tax or National Insurance on the income they have sacrificed.

Who is affected?

From April 5, 2011, tax-free vouchers will no longer be available to employers not yet signed up to a scheme. Those already in one have until April 5, 2015.

What if the Tories win?

The Conservatives confirmed they will not re-introduce the policy should the party win the next election.

Source: The Times online

Thank you to all our entrants into our colouring in competition and congratulations to the winner, Florence Morgan, aged 4

Aviva are encouraging young families to think about life cover at a pivotal moment in their lives, they’re offering:

• £10,000 of free cover to both parents - meaning total free cover of £20,000 if each applies for their own policy.
• Available up to 6 months after the child’s birth
• The cover will run up to and including their 1st birthday
• The plan has no cash in value at any time

For more information, please click here then ring one of our Parent Advisers on 0800 043 5440.

ParentGuideToMoney.co.uk launched its brand to 1,000’s of parents; those to be and those already by offering a new information service dedicated to assisting parents with the financial side of bringing up children. Chris Smart (Principal) was invited to the stage as a guest speaker on Saturday & Sunday which was met with tremendous interest and surprise. Whilst FREE caricatures were drawn, parents received a FREE Financial Guide in return for completing our Parent Survey - results to be published next week.

Were you there?    What did you think?     Let us know your thoughts…

We have contacted almost everyone who took part in our Parent Survey and are following up those of you who requested our more immediate services.

Dont forget to visit our website ParentGuidetoMoney.co.uk or call 0800 043 5440 for further information.

Thank you to all our entrants into our colouring in competition and congratulations to the winner, Chloe Traves, aged 11