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Poor families least likely to gain from tax-free scheme

New analysis shows the extent to which families will miss out of the Government's plans to extend childcare support for working families, both through the new Tax-free Childcare scheme and extra support through universal credit to meet 85 per cent of childcare costs.

Both schemes confirmed by the Chancellor in last week's Budget do not come into play until after the general election.

The Resolution Foundation's analysis shows that at most four in ten working families with children on universal credit will be eligible for the more generous level of support to have 85 per cent of their childcare costs met.

The group most likely to be excluded from receiving 85 per cent of their childcare costs paid will be the lowest income working families on universal credit with one or more parents working part-time on low pay.

This contrasts with the tax-free childcare scheme for better-off families who can claim 20 per cent of their annual childcare costs, up to £6,000 a year.

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