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11 Jun 2022

6 ways to save money on childcare in the school summer holidays

From tax-free childcare to discounted holiday camps, our tips can help reduce your outgoings
Children jumping on a trampoline

With schools breaking up for summer at the end of July, many parents are already worrying about how to juggle a full-time job with looking after children.

It’s unlikely parents will have enough annual leave entitlement to cover the full six weeks most state schools in the UK are closed for, so many people have no other choice but to fork out for extra childcare.

The cost of living crisis, however, means family finances are under increasing strain. 

Some families are already spending £10,000 a year on formal childcare, according to a report from the Institute for Fiscal Studies. And prices are rising - a survey by the charity Coram Family and Childcare found some parents have seen childcare costs rise by up to 3.5% in the past year alone.

Here, we've come up with six tips for saving money on childcare this summer - from schemes to reduce your outgoings, to subsidised holiday camps.

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1. Use tax-free childcare to reduce costs

HMRC has estimated that roughly 1.3m families could be missing out on tax-free childcare support - so it's worth checking if you're eligible.

Under the tax-free childcare scheme, you can claim back 25% of your childcare costs, including summer holiday provision, so long as you (or your partner, if you have one) are working and earn at least national minimum wage or living wage for 16 hours a week. 

If you're looking to book an activity or club for your kids during the holidays, make sure you check that it qualifies for tax-free childcare; it will need to be Ofsted-registered to do so.

To get started, you’ll need to set up an online account which can be used to manage payments to your childcare provider. 

For every £8 you deposit, the government will pay in £2, up to the value of £500 every three months, or £1,000 if a child is disabled. You'll have to meet other set criteria, too, including having a child under 11 and earning less than £100,000.

Note that you can't claim tax-free childcare at the same time as any childcare elements of working tax credit or universal credit.

Find out more: tax-free childcare and other ways to save

2. Check for benefit-related childcare help

If you already receive working tax credit, you may be able to receive the childcare element of the benefit payment. As long as the childcare you use is registered and your children are aged 15 or under (16 or under if they have a disability), the extra payment can help with the costs of holiday playschemes - even if the childcare is only for a short period. 

The working tax credit element means you can get up to 70% off what you pay for childcare, up to a maximum of £175 a week for one child, or £300 for two or more children.

Universal credit, which is gradually replacing other benefits including tax credits, also has a childcare element. If you're eligible, you may be able to claim up to 85% in childcare costs, to a maximum of £646 a month for one child or £1,108 for two or more children. This childcare element will be included with your overall payment.

Note that you can't claim tax credits and universal credit at the same time.

Find out more: find out what you are entitled to using our working tax credit and universal credit guides

3. Find discounts for holiday clubs

Holiday clubs/camps are a popular option for parents over school breaks. They cater for schoolchildren from the age of four (although many are for over fives only) and, in the UK, are mostly non-residential. 

How long they run for varies - from as little as one day to two weeks or more, and the start and finish times also differ. For this reason, you should shop around to find the right option for your circumstances. Then, there’s no time like the present to book, as many providers offer early-bird discounts.

For example, Fit For Sport offers a 10% discount for advance bookings on its summer activity camps in England. 

Alternatively, if you have previously booked with UK-wide day camp provider Barracudas, it's offering a “recommend a friend” discount - if a person books based on your recommendation, you will both receive £20 off your bookings.

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4. Look out for subsidised activities

Booking a holiday club for the full six-week break can prove expensive - especially if you’ve got more than one child. Luckily, there are cheap, free and affordable UK holiday schemes for schoolchildren, which still had places available at the time of writing.

The National Citizen Service (NCS) is a two-week long residential programme for 15 to 17-year-olds in England and Northern Ireland. Young people take part in a series of activities and workshops aimed at developing life skills from volunteering to cooking. 

Because it is largely funded by the UK government, places cost no more than £50 per child. That price includes transport to the site, accommodation, food and activities. Bursaries and free places are also available on a case-by-case basis.

There are many other organisations which offer similar help for families who can’t afford the full price. National provider Kings Camps, for example, has hundreds of places that are subsidised between 25% and 75%, based on individual circumstances.

5. Find out what local support is on offer

It’s worth checking out your local council’s website or asking them directly about what subsidised or free activities they are running during the school holidays. 

Since 2018, local authorities have been awarded funding by the Department for Education to coordinate a Holiday Activities and Food Programme (HAF) for children aged four to 16 living in the area and eligible for free school meals.

Councils either provide the clubs themselves, or work with local providers to deliver clubs offering activities such as arts, sports, drama and music.

Charity Coram Family and Childcare is another great resource, and lists organisations offering childcare in your local area. This includes things such as youth groups and community centres, which offer some form of help during the holidays.

It’s also worth checking the Family and Childcare Trust website if you're in England, the Gov.wales website if you're in Wales, or the FamilySupportNI website if you're in Northern Ireland. Here, you can find your nearest Family Information Service that will give you information on what's going on locally. In Scotland, contact your local council.

6. Consider sharing a nanny

Another option, if you have a parent friend who’s also looking for childcare during the holidays, is to share a nanny. 

It’s a good way to cut costs, but bear in mind that each family must fulfil their responsibilities as separate employers. That means, for example, registering with HMRC as an employer, having a contract of employment and each paying the nanny at least the minimum wage.

Websites such as childcare.co.uk and korukids.co.uk are good places to find someone in your local area willing to be part of a nanny share arrangement.