With the Chancellor; George Osbourne, eagerly waiting to give us an update on the latest budget news on the 19th March, Findababysitter.com thought we’d jump full steam ahead and give you a round up of what to expect.
What is ‘The Budget’?
The Budget is a report released each year by the Chancellor of the Exchequer to Parliament and the nation. The role of the Budget is to control public finances by setting out how much tax the Government will collect, how much the Government will borrow, and how much the Government will spend. When the Government publishes the Budget, the chancellor gives a speech to Parliament in which he sets out the key decisions on tax, borrowing and spend.
What childcare changes were made last year?
With the release of our Annual Childcare Report in 2013, we knew last year childcare costs were going to be high on the agenda. Last year, Osbourne made a promise that all ‘families earning up to £150,000 will get up to £1,200 to help with childcare.’ This scheme was planned to get underway in Autumn 2015 – where working parents will be able to claim vouchers to subsidise nannies or childcare for every child under five. This scheme is expected to extend to under 12 by 2020. Initially, this scheme will benefit over 1.3 million families in the UK as they’ll be able to claim £1,200 per child.
What childcare changes do we hope to see in 2014?
Since the Budget 2013 announcement last year, we haven’t witnessed a huge change. Our Annual Childcare Report 2014 revealed that the cost of childcare had in fact risen 19% since last year – insinuating that childcare costs are getting increasingly more expensive. With this in mind, today, Nick Clegg announced that George Chancellor is hoping to give all working couples a tax break worth £2,000 per child. This will mean that all working couples will not have to pay basic-rate tax on the first £10,000 they spend on nannies, babysitters, childminders etc. Moving forward, this is a very positive step. The Government have increased the tax break from £1,200 (2013) to £2,000 (2014) and also increased the amount of shared income to make more families eligible to the scheme, from £150,000 (2013) to £300,000 (2014), allowing 1.9million families to be involved rather than 1.3million. It is expected that Osbourne will announce for the scheme to start sooner than Autumn 2015 – hopefully in time for the next general election.
How will the scheme work once in place?
Parents will have to set up an online account, allowing them to get a 20% rebate per child, on an annual cost that childcare costs are £10,000 a year.
Keep your eyes peeled, we will have more information on the Budget 2014 when the announcement is made tomorrow!
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