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Government extends tax-free childcare to more families

Families with children under five will be able to claim up to 1,200 per child a year in tax-free childcare through a scheme announced by the Prime Minister and the Deputy Prime Minister today.

However, the Tax-free Childcare Scheme will not be introduced until autumn 2015 and both parents must be working to be eligible.

In the first phase, the offer will be open to around 1.3m families, where both parents are working and do not already receive support through tax credits, or Universal Credit, when this is introduced. They will receive 20 per cent of their annual childcare costs, up to £6,000 a year. The scheme will eventually be extended to all children under 12.

It will also be open to high earners - both parents will be eligible as long as they earn less than £150,000 a year each.

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